Post on 08-Aug-2018
SIMPACTPROJECTREPORTReport#D5.1
ImprovedMeasurementoftheEconomicsofSocialInnovation
RenéWintjesa,NordineEs-Sadkia,RüdigerGlotta,AdNottena
a MaastrichtUniversity,MERIT
March2016
The SIMPACT project receives funding from the European Union’s Seventh Framework Pro-grammeforresearch,technologicaldevelopmentanddemonstrationunder�GrantAgreement
No:613411.
AcknowledgementsWewouldliketothankMinnaKanerva,HugoHollandersandotherswhohaveprovidedinputsorcommentstodrafts,
andAnnaBerlina,LeneisjaJungsberg,MariaKleverbeck,TamamiKomatsu,LiisaPerjo,SaeedSamanandJudithTer-
striepfortheirsupportwiththesurveyofSIMPACTcasestudies.
SIMPACTSIMPACTisaresearchprojectfundedundertheEuropeanCommission’s7thFrameworkProgrammefrom2014-2016
andistheacronymfor«BoostingtheImpactofSIinEuropethroughEconomicUnderpinnings».Theprojectconsortium
consistsoftwelveEuropeanresearchinstitutionsandisledbytheInstituteforWorkandTechnologyoftheWestpha-
lianUniversityGelsenkircheninGermany.
LegalNoticeThe informationandviewssetout in thisreportare thesoleresponsibilityof theauthor(s)anddonotnecessarily
reflecttheviewsoftheEuropeanCommission.
DocumentProperties
ProjectAcronym SIMPACT
ProjectTitle BoostingtheImpactofSocialInnovationinEuropethroughEconomicUnderpinnings
Coordinator InstituteforWork&TechnologyofWestphalianUniversityGelsenkirchen
DeliverableD5.1 ImprovedMeasurementoftheEconomicsofSocialInnovation
Author(s) RenéWintjes,NordineEs-Sadki,RüdigerGlott,AdNotten
DocumentIdentifier FP7-SSH.2013.1.1-1-613411-SIMPACT–D5.1
WorkPackage WP5MeasuringtheEconomicsofSocialInnovation
Date 11April2016
SIMPACT–T5.1|i
TableofContents
1 EXECUTIVESUMMARY 1
2 DELIVERABLESTRUCTURE 4
3 DEFININGSOCIALINNOVATION&ITSECONOMICUNDERPINNING 5
3.1 DefiningSocialInnovation 5
3.1.1 SocialInnovationintheLiterature 5
3.1.2 SemanticAnalysis 7
3.2 SIMPACT’sConceptualFramework 8
3.3 TowardsanEconomicFrameworkofSI 10
3.3.1 InvestmentbyFirmsinIntangibles&itsEconomicImpact 113.3.2 AdditionalIntangibles&InnovationsinthePublic&CivicSector 14
3.3.3 UseValue&ValueCo-CreationinaSystemicService-logicofSI 23
3.4 WhattoMeasureorIndicate? 27
4 INDICATORSONSOCIALINNOVATION 30
4.1 SocialInnovationMeasurement 30
4.2 Information&DataforSIMetrics 32
4.3 Micro-levelofSI,Innovators,Beneficiaries&Initiatives 33
4.4 Macro-levelofRegions&Countries 39
4.5 SuggestedIndicatorSets 42
5 EVALUATIONANDIMPACTASSESSMENTOFSOCIALINNOVATION 57
5.1 SIImpactMeasurementTools&Methods 57
5.1.1 SocialAccounting&Auditing(SAA) 58
5.1.2 SocialReturnonInvestments(SROI) 60
5.1.3 OtherSocialImpactMeasurementApproaches 61
ii|SIMPACT–T5.1
5.2 UsageofFormalEvaluation&AssessmentToolsforMeasuringEconomic&SocialImpact 63
5.3 Whyevaluate&assessImpact? 66
5.4 Light,informal&theory-basedImpactEvaluations 68
6 MEASUREMENTGAPANALYSIS:WHATISLACKING? 75
6.1 GapsinMeasurementofSI 75
6.2 GapsintheMeasurementoftheSIsImpact 76
7 INDICATOR-BASEDPROFILINGOFSIATMICROLEVELOFSIMPACTCASESTUDIES 78
7.1 SurveyofSIMPACTCaseStudies 78
7.2 ExplorativeMethodology:CategorisationbyPrincipalComponentAnalysis 83
7.3 ResultsofFactorAnalysis 86
7.4 IndicatorApplicationinfullSIProfilesatMicroLevel 95
8 INDICATORBASEDPROFILINGOFSOCIALINNOVATIONATTHELEVELOFEUROPEANREGIONS 99
8.1 RegionalData 99
8.2 ExplorativeMethodology:CategorisationofEURegionsonSIComponentsbyPCA 100
8.3 ResultsoftheFactorAnalysis 103
8.4 ResultsoftheRegressionAnalyses:ImpactonGDPandbeyond 107
8.5 ResultsofClusterAnalysis&ApplicationofRegionalSIProfiles 111
8.6 Micro-SI-ProfilesperTypeofregionalSIProfile 115
9 CONCLUSIONS 117
References 120
Appendix 127
SIMPACT–T5.1|iii
Figures
Figure1. Instancesofuniquewordsandphrasesusedinsocialinnovationresearch 7
Figure2. Schumpetertypesofinnovation 13
Figure3. TEPSIE’sIntegratedmodelformeasuringSI 14
Figure4. Civicactivismandinclusioninrelationtoeconomicgrowth 15
Figure5 Categorisationofaggregatedsocialinnovativeness* 17
Figure6. Keyallocationmechanismsinthethreeeconomicdomains 19
Figure7. TheEconomicframeworkofSI 20
Figure8. Valueco-creationinaservice-systemsperspective 24
Figure9. ConceptualframeworkofSIasvaluecreation 26
Figure10. TheCreatingSocialValueSpace 28
Figure11. Socialimpactinvestmentmarketframework. 29
Figure12. Philanthropicevidencechart 59
Figure13. TheEUconsumermarketscoreboard(EU,2015c) 64
Figure14. Mappingofimpacttools 65
Figure15. ImpactChainoftheSocialReportingStandard 68
Figure16. TypicalStructureofaLogframeMatrix 72
Figure17. StrengthsandCommonProblemswiththeApplicationoftheLFA 72
Figure18. SIinputprofilesbygeographicalscale 88
Figure19. SIinputprofilesbytheme 88
Figure20. SIinputprofileforNGOs&forinnovatorswithalong-termoutlookratedasverypositive 89
Figure21. OutcomeprofileforregionalandnationalandlocalSIscale 92
Figure22 Outcomeprofilebytheme,mainfunder,typeofSI,andSIwithverypositivelong-termperspective 93
Figure23. SIprofilebyscaleofimplementationandthemeofSI 97
Figure24. SIprofilesbytypeofSI,andlong-termoutlook,basedonaveragefactorscores 98
Figure25. Regionalscoreon‘Governancevs.civil’ 106
Figure26. Regionalscoreson‘Unemployment’ 106
Figure27. Regionalscoreson‘TrustinState&newideas’ 107
Figure28. Regionalscoreson‘Failingeducation’ 107
Figure29. Screeplotwitheigenvaluecurve 108
Figure30. P-PplotsforRegionalHumanDevelopmentIndexandRegionalGDPpercapita 108
Figure31. RegressionsforregionalSIFactor1:‘Governancevs.Civil’withRegionalHDI(left)andGDP(right)asdependentvariables 109
iv|SIMPACT–T5.1
Figure32. RegressionsforregionalSIFactor2:‘Unemployment’withRegionalHDI(left)andGDP(right)asdependentvariables 109
Figure33. RegressionsforregionalSIFactor3:‘TrustinState&newideas’withRegionalHDI(left)andGDP(right)asdependentvariables 110
Figure34. RegressionsforregionalSIFactor4:‘FailingEducation’withRegionalHDI(left)andGDP(right)asdependentvariables 111
Figure35. RegressionsforregionalSIFactor5:‘Engagement’withRegionalHDI(left)andGDP(right)asdependentvariables 111
Figure36. FourtypesofSIregionsinEurope 112
Figure37. MacroSIprofilesforthefourtypesofSIregionsinEurope 113
Figure38. AveragemacroSIprofilesforselectedcasesbythemeofSI 114
Figure40. MacroSIprofilesforselectedcasesbylong-termoutlookoftheSI 115
Figure41. MicroSIprofilepertypeofregion 115
Figure41. Microinput,output,andfullSIprofileforcasespertypeofregion 116
SIMPACT–T5.1|v
Tables
Table1. Top25wordsandphrases 8
Table2. Top10countriesresearchingsocialinnovation 8
Table3. AcategorisationofSIComponents,Objectives&Principles 9
Table4. Classificationoffunctionsofgovernment(COFOG) 16
Table5. ExchangevalueinGood-Dominantlogicvs.Use-valueinService-Dominantlogiconvaluecreation. 23
Table6. Foundationalpremisesofservice-dominantlogic 25
Table7. Aneeds-solutionsmeasurementframework 33
Table8. Paidemployeesandvolunteersasashareofthirdsectorworkforce(FTE),in% 40
Table9. TEPSIEStructureoftheblueprintofSIindicators 41
Table10. AcategorisationofSocialInnovationcomponents,objectivesandprinciples,andpossiblemetrics(usingexistingdatasources) 44
Table11. Macro-level(nationalandregional)IndicatorsetforSI,withEUdatasources 47
Table12. IndicatorsontangibleormonetisableaspectsofSIinausetable,anindicativeinput-outputexerciseonSIenablersandSIbeneficiaries. 50
Table13. MainsurveyquestionsaddressedbytheSIcasesofSIMPACT 53
Table14. Thecombinedsetsofmicro-andmacro-levelofindicatorsforSI,forintangibleandtangibleaspects 54
Table15. Formalandinformallearningfromevaluation 67
Table16. Surveyquestionsandcodeusedindatabaseandgraphs 79
Table17. Overviewofstudiesidentifyingfirmlevelinnovationmodes 83
Table18. Hierarchicalfactoranalysis(2ndstage)oningredientsoffirminnovationstrategies:4modes 85
Table19. Typesofresources/inputstoSI,patternmatrixoffactoranalysis 87
Table20. TwotypesofSIobjectives,patternmatrixoffactoranalysis 90
Table21. TypeofSIobstacles,patternmatrixoffactoranalysis 90
Table22. TypesofSIoutput/outcome,patternmatrixoffactoranalysis 91
Table23. FivecomponentsofSI;patternmatrixoffactoranalysis 95
Table24. Sampleofvariablesinthedatabase 101
Table25. Factoranalysisonregionalindicators:fiveSIcomponents,patternmatrix 103
vi|SIMPACT–T5.1
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SIMPACT–T5.1|1
1 EXECUTIVESUMMARY
ThisreportonimprovedmeasurementoftheeconomicsofSIsynthesisesthere-
sultsofTasks5.2and5.3ofworkpackage5ofSIMPACT.Itoutlinesthefinalsetsof
developedindicatorsandexemplifiestheirapplicationbymeansofindicatortypes
andtheanalysisofSIeconomicsfordifferentcategoriesoftheSIMPACTcasesof
Social Innovation(thecasestudiesofWP3)aswellasthedifferentcategoriesof
nationalandregionalcontextsforSI.
Weconcludethatsocialinnovationhasmanyaspects,andisanevenbroadersoci-
etalconceptthanotherformsofinnovation,suchasthemoretraditionaltechno-
logical,andfor-profitinnovations.Besidesaconceptualbroadening,alsothemet-
ricsandmeasurementapproachesneedtoincorporateabroaderperspective,by
specifically includingthepublicsector,thesocialorthirdsector,andtheprivate
sector,sincesocialinnovationdealsaboutthenewcombinationsofresourcesand
capabilitiesfromthesesectors.Abroadrangeofresourcesandcapabilitiesofthese
differentsectorsserveasinputtothesocialinnovations.Inaddition,theobjectives,
andthebenefitsand impacts fromthesocial innovationsdiffer foreachof these
threesectors.Measuringsocialinnovationthereforeinvolvescapturingtheseas-
pectsforthevarioussectors.Formeasuringsocialinnovationorthemeasurement
ofitseconomicimpacts,itisnotenoughtolimittheindicatorstoonlyoneortwo
ofthesethreeeconomicsectors.
Wecanconcludethatthevalueorimpactofsocialinnovationsderivefromthein-
teractionbetweenthesupplyanddemandforsocialinnovations.Therefore,indi-
catorsetsneedtoincludebothindicatorsforthedemand,orfortheneedsforsocial
innovations,aswellasindicatorsforthepotentialtosupplysolutions.Theinterac-
tionbetweendedemandandsupply-sideofsocialinnovationastheeconomicun-
derpinningofsocialinnovationisnotmediatedbypricesonmarketsforexchange
value.Aswithotherkindsofinnovationstheproducersandusersofinnovations
have to engage in interactive learning, which involves communicating tacit
knowledgeanddiscussionsofintangiblesandusevalueamongcollaboratingpart-
ners.
Regarding themeasurementofSIatmicro level it is relevant tocapturevarious
inputs,outputs,objectivesandobstacles.Theimportanceofcertaininputsdiffers
byforinstancethetypeofmainfunder,thethemeofSI,andthescaleofoperations.
Socialinnovationsatlocalscalehaveonaveragealowernumberofactorsandco-
operation,anda lowerdegreeofdiversityofknowledge thansocial innovations
whichoperateatnationallevel.Thesetwoinput-factors(alargenumberofactors
Socialinnovation-amultifacetedphe-nomenon
Value&impactofso-cialinnovation
Measurementatmicro-level
2|SIMPACT–T5.1
andpartners,anddiversityofknowledge)arealsocharacteristicforthesocialin-
novationswhichhaveaverypositivelong-termperspective.ICTseemsamoreim-
portantsourceofinputforSIinthethemeofDemographicsandEducation,thanfor
socialinnovationsinthethemeofEmployment.ICTinvestmentsseemalsomore
commonamongsocialinnovationswhichareimplementedatnationalscale(com-
paredtothoseimplementedatlocalscale).Ontheotherhand,forSIinthetheme
ofEmployment,knowledgeisarelativelyimportantinput.
Itisdifficultforinnovatorstocombineinonesocialinnovationthetwoobjectives
ofseizingbusinessopportunitiesandincreasingpublicvalueswhichdonotbenefit
themarginalisedtargetgroupdirectly(e.g.:socialcohesion, inclusion, lobbying).
The co-rated importance of organisational and legal obstacles confirms the im-
portanceofthehybridissueforsocialinnovatorsconcerningtheproblemtofind
theappropriatelegalformoforganisationfortheiractivities.
Theconcentrationofsocial,financialandpoliticalobstaclesforcertainsocialinno-
vationsseemstoserveasanidentificationofradicalsocialinnovations.
Severaltypesofeconomicoutputcanbeidentified:economicoutcomesforthein-
novator,economicoutcomesforthetargetgroup,andbenefitsintermsofpublic
budget.Othersocialbenefitscannotdirectly,betranslatedintoeconomicbenefits,
oritwouldtakeamuchlongertimetomaterialise.
Socialinnovationswhichareimplementedatlocalscalehaveahigheconomicim-
pactforthetargetgroupandthepublicbudget,buttheimpactsfortheinnovator
arerelativelysmallcomparedtosocialinnovationswhichareimplementedatna-
tionallevel.SIsimplementedatnationalscalehaveonaveragelessimpactonpublic
budgetand lowerratedeconomic impacts for the targetgroup,but thebusiness
economic impacts for the innovators are rated higher. Social innovations in the
themeof«Employment»arecharacterisedbyonaveragehigheconomicimpactsfor
thetargetgroup.Socialinnovationsthatareproduct/serviceinnovationsdowellon
theeconomicimpactsfortheinnovators.SIswhichinvolveaddressinganewtarget
groupdoverywellonallimpactfields,excepteconomicimpactsfortheinnovator.
Inorderto improvetheir long-termperspective,policymakersshouldtherefore
investinthebusinesscapabilitiesofthesesocialinnovators(withoutapplyingfur-
ther output related objectives concerning benefits for the marginalised target
group).
Socialinnovationsthathaveaverypositivelong-termperspective,haveaboveav-
eragescoresonimpactsfortheinnovator,butalsoforsocialaswellaseconomic
benefits for the target group. Themore general policy implication is that policy
makers,whowanttoincreasethelong-termeconomicimpactfromsocialinnova-
Complexityofbusi-ness&organisational
models
Economicoutputs&benefits
Economicbenefitsfortheinnovator&
targetgroups
Complementarityinimpactsfromem-
poweringinnovator&targetgroups
SIMPACT–T5.1|3
tion,shouldnotmerelyfocusonoutputintermsofempowermentofthemarginal-
isedtargetgroup,butshouldalsoinvestintheempowermentandlong-termper-
spectiveofthesocialinnovators.
Basedonalargesetofregionalstatisticswithrelevancetosocialinnovation,we
canconcludethattheregionalsituationconcerningsocialinnovationdifferswithin
Europe,andnotalldifferencescanbereducedtodifferencesbetweencountries.
TheidentifiedregionalSIfactorsarebothrelatedtodifferencesinregionalGDPas
wellasregionalHumanDevelopmentIndex,anindexwhichcanbeseenasanout-
putindicatortomeasuretheimpactofSIbeyondGDP.
Fourdifferenttypesofsocialinnovationregions(orregionaleco-systems)within
theEUareidentified.Thefirstgrouporclusterofregionswithsimilarsocialinno-
vationcharacteristics,arecharacterisedbythehighscoreontheSIfactor,which
wehavelabelled‘Failingeducation’.Thesecondgroupofregionsarecharacterised
byhighscoresontheSIfactors:‘Governancevs.civil’,and‘Engagement’.
TheSIMPACTcasesinthefirsttypeofregiondowelloneconomicimpactforthe
targetgroup.TheSIMPACTcasesinthesecondtypeofregionhaveratherdisap-
pointingimpactsforthetargetgroup.Knowledgeisamoreimportantinputfactor
fortheSIMPACTcasesinthefirsttypeofregion,comparedtothoseinthesecond
typeofregions.
SIMPACTsocialinnovationswithaverypositivelong-termoutlookareespecially
tobefoundinregions,whichhavehighscoresontheSIfactor‘unemployment’,and
wherelife-long-learningtypeofsocialinnovationsseemstoservethemarginalised
targetgroupsaswellastheirregionaleconomies.
Distinctregional&Europeanpictures
RegionalSIecosystems
4|SIMPACT–T5.1
2 DELIVERABLESTRUCTURE
AsstatedintheDoW,thisreportsynthesisestheresultsofTasks5.2and5.3ofwork
package5ofSIMPACT.Itoutlinesthefinalsetsofdevelopedindicatorsandexem-
plifiestheirapplicationbymeansofindicatortypesandtheanalysisofSIeconom-
icsfordifferentcategoriesofSIMPACTcasesofSocialInnovation(thecase-studies
ofWP3)aswellasthedifferentcategoriesofnationalandregionalcontextsforSI.
Thedeliverablealsoincludesresultsoftasks5.1,sinceitstartswithdefiningsocial
innovationanditseconomicunderpinninginchapter3,wherewestartwithare-
viewandsemanticanalysisofsocial innovation inthe literature.Theconceptual
start isashortsummaryofSIMPACT’sconceptual frameworkofSIComponents,
ObjectivesandPrinciplesinparagraph3.2.Thenextparagraphdevelopsaneco-
nomicframeworkofSIbyemphasisingtheimportanceofinvestmentsinintangi-
blesandthecivilsector,asathirdeconomicsector,nexttotheprivateandpublic
sector.
Chapter4addressesindicatorsofsocialinnovationatthemicrolevelofsocialin-
novationsandthemacrolevelofcountriesandregions.Thischapterresultsinsug-
gestionsforindicatorsetsatbothlevelsinparagraph4.5andthesesuggestionsare
presentedindifferentforms.Chapter5discussesaselectionoftoolsforevaluation
andimpactassessmentofsocialinnovation.Sincethereisnosinglebestpractice
tool,itisimportanttoconsidertheobjectiveoftheevaluationandthecosts.Chap-
ter6identifiesthegapsinmeasurementofSI,aswellasthegapsinmeasurement
of the impactsofsocial innovation. Inchapter7 theanalysisof thesurveyof55
SIMPACTcasesofsocialinnovationispresented.Basedontheresults,indicators-
basedprofilesat thismicro levelofSI isprovided for typesofSI.The indicators
allow to characterise SI inputs, objectives, obstacles, and outcomes for various
groupsofcases.Chapter8presentstheresultsoftheapplicationoftheindicator
setsattheregionallevel.Withtheuseoffactoranalysis,thecollectedregionalsta-
tisticaldataisreducedintoregionalSIfactors.WetestiftheseregionalSIfactors
haveanimpactonGDPandbeyond.Conclusionsaredrawninchapter10.
Inaddition,aworkingpaperonanorganisationalapproachtomeasuringsocialin-
novation,i.e.«SocialInnovationRegimes»andsuggestsindicatorsandamethodto
applytheminordertomaketheconceptofSIregimeoperationalhasbeenelabo-
rated(CastroSpila,Luna&Unceta,2016).
SIMPACT–T5.1|5
3 DEFININGSOCIALINNOVATION&ITSECO-NOMICUNDERPINNING
3.1 DefiningSocialInnovation
TheworkingdefinitionofSocialInnovation(SI)withintheSIMPACTprojectisset
outbyRehfeldandcolleagues(2015)as:
“SocialInnovationreferstonovelcombinationsofideasanddistinctformsofcol-
laborationthattranscendestablishedinstitutionalcontextswiththeeffectofempow-
eringand(re)engagingvulnerablegroupseitherintheprocessofsocialinnovation
orasaresultofit.”(Rehfeldetal.2015:6)
ReachingbacktothetheoriesthatSchumpeter(1912)formulatedoneconomicde-
velopment,andtheroleofinnovationinthisdevelopmentprocess,andbydrawing
onthesubsequentlyformalisedevolutionarytheory(Nelson&Winter,1982;Dosi,
1982)wecanunderstand“socialinnovationasanevolutionaryprocess”which“com-
prisesthedevelopment,implementation,practicalapplication,andconsolidationof
suchnovelcombinations”(Rehfeldetal.2015:7).Thistheoreticalbasisenablesus
totranslateeconomicdevelopmentintosocialdevelopmentandtointroduce,fur-
theron,acategorisationoftherolesthatinnovationplaysinthesocialspheree.g.
society.
3.1.1 SocialInnovationintheLiterature
Ageneralisableandcommonlyagreeddefinitionofsocialinnovationhasprovento
beratherelusiveduetocomplexnatureofsocietyitselfandthepartsofsocietyin
whichsocialinnovationcouldplayarole.
Ifwesurveytheliterature(Howaldtetal.,2014;Caullier-Griceetal.,2012)onso-
cialinnovation,andmakeaninventoryofthedifferentdefinitionsordescriptions
ofwhatauthors thinkmakesupsocial innovation,we find that there isa rather
broadunderstandingofsocial innovationindeedbasedonSchumpeter’soriginal
ideas.Althoughbroad,continuouslypresentinalmosteachofthedefinitionsare
theconceptsofwelfareandsocialexclusion/inclusion.WefindthatPolandVille
(2008,2009)andSerat(2012)findtheconceptofsocial innovationistoovague
andnothingmorethanahype.Abarriertoanunderstandingofsocialinnovation
istherelativelyunderdevelopednatureofresearchintotheareaitself,whichhas
6|SIMPACT–T5.1
received little attention so far.However, the firstmentioned authors, aswell as
Heiskala(2007)andEtorreandcolleagues(2013),alsounderlinethataninnova-
tioncanbetermed“social”ifithasthepotentialtochangeandimprovethequality
andquantityoflife(e.g.welfare)inasocietybyaddressingsocialneedsandaffect-
ingpositivechangesinthesocialstructure.
BenneworthandCunha(2015)remarkthatthereseemstobeageneralawareness
thattheabovedescriptionisofuniversalvalueastheEuropeanCommissionun-
derlinestheneedforasustainableandinclusivesocietyinitsEurope2020strategy
affectedthroughpolicyinterventionsin,amongothers,“employment,innovation,
education,socialinclusionandclimate/energy”(EC,2013).Theyfurthermorepoint
outthattheformulated“GrandSocietalChallenges”cannotbesolvedbyeconomic
developmentalone.Actionbykeyactorsisrequiredtoaddresssocialexclusionand
marginalisationofcommunitieswhichareshutoutof“differentkindsofmarkets
for public services, including housing, health, education, employment and
transport”(Benneworth,2013).Thesecommunitiesofmarginalisedpeople,living
aprecariousexistenceandsometimestermed“theprecariat”(Standing,2011),are
facingamarketfailurefortheir“proletarianclass-in-itself”,andalock-inintothis
economicandsocietalfailurewhichdemandschangesintheexistingsocialstruc-
tures(GarudandKarnoe,2013,MiegandTöpfer,2013).
Fromtheabovewecanrefineourearliergeneralisabledescriptiontoincorporate
threekeycharacteristics:
1. Theinnovationcreatesorhassocietalproblem-solvingcapabilitiesorca-
pacities
2. Theinnovationinvolvesbuildingandorganisingnetworksandstructures
(coalitions)betweenkeyactorsfacilitatingnewwaysofworkingornew
formsofaction.
3. Theinnovationisscalabletoothercontexts.
MoulaertandSekia(2003)addaprerequisitetothesethreecharacteristicsinthat
thesocialinnovatormustbeembeddedwithinthelocalsociallife/society,empha-
sising the importance of the “territorial” (e.g. micro) context of the problems,
causedbyeconomicandsocialfailure,andfacedbytheprecariatactorsononeend
andtheinstitutionalactorsontheother.Therelevanceofthisembeddednessofthe
socialinnovators,andtheirinnovations,canalsobeseeninTable3ofthepaperby
TurkeliandWintjes(2014)wherewecanfitsocialinnovationintotheregional,but
foremostintothelocalsystemofinnovationcontext.
SIMPACT–T5.1|7
3.1.2 SemanticAnalysis
Aconfirmationofthedescriptionofsocialinnovationandoftheaspectsofsocial
innovationhighlightedintheprevioussectioncanbefoundinthefollowingseman-
ticanalysisoftheresearchdoneonsocialinnovationintheyears1966to2015.
Intotal,weretrievedanumber1234documentspresentingstudieson,orreferring
to,socialinnovation.ThisdataweretrievedfromtheScopuscitationindexusinga
query focusingonkeywordssuch“social innovation”, “society”, “innovativeness”
etc.Furthermore,weemployeddata-miningtechniquestogaugethedirectionthat
theresearchinthefieldistaking.Semanticaswellasgeographicindicatorscanbe
harvested,analysedandvisualised.
Figure1. Instancesofuniquewordsandphrasesusedinsocialinnovationresearch
InFigure1,weshowtheuniquewordsandphrasesusedinsocialinnovationre-
search,arrangingthembythenumberofinstancestheyappearintheabstractof
the research papers in question.We find that apart from the social innovation
phrase,whichislessoftenusedassuchthananticipated,alargenumberofterms
arefoundthatsupportthedescriptiveandexploratoryreviewpresentedearlier.If
wenowlookspecificallyatthetop25termsandphrases(Table1)weindeedsee
communityandsocietyrelatedterminologyfeaturinginthetop12,whilethesome-
whatmoreactorandmarketrelatedtermsandphrasesmakeuptheremainderof
thislisting.Theseoutcomespointtotherelevanceofsocialinnovationasaconcept
andtosocialinnovatorsasimportantagentsofchangeinsocietyatlargeandlocal
communitiesonamoremicro,“territorial”,level.
0
50
100
150
200
250
300
socialinno
vatio
nlocalcom
mun
itysustainability
services
Education
socialentrepreneurship
policy
glob
aliza
tion
politics
change
resource
creativity
learning
inclusiveness
food
family
universities
market
consum
ers
serviceusers
company
activism
professio
nal
transitions
agro-socialinn
ovations
adaptatio
nmentalhealth
Aboriginalcom
mun
ities
socialsciences
climatechange
participatorydesig
ndisrup
tiveinno
vatio
nsdemand
immigrants
8|SIMPACT–T5.1
Words&phrasesfromtheabstracts Instances
Words&phrasesfromtheabstracts Instances
socialinnovation 240 Education 39
innovation 181 environment 39
community 73 technologies 39
developed 64 knowledge 38
localcommunity 57 government 38
socialdimension 52 socialentrepreneurship 38
publicsphere 54 working 32
health 53 policy 32
sustainability 52 science 32
socialinclusion 50 globalisation 30
society 45 future 29
services 41 opportunity 27
economics 41
Table1. Top25wordsandphrases
Furthermore,divergingtogeographicindicatorsofSIresearch,weseeinTable2
thetop10countriesengagedinsocialinnovationresearch,ofwhich60%areEU
memberstates.
Country* Numberofpapers Country* Numberofpapers
UnitedKingdom 153 Germany 52
UnitedStates 110 Spain 50
Canada 67 France 39
Italy 59 Japan 37
Australia 57 Netherlands 32
Table2. Top10countriesresearchingsocialinnovation(*asderivedfromauthoraddress)
3.2 SIMPACT’sConceptualFramework
InTable3wehavesynthesizedSIMPACT’sconceptualframeworkofSocialInnova-
tioncomponents,objectivesandprinciples.AsRehfeldandcolleagues(2015)con-
clude, it isapparent fromthecategorisationofSocial Innovationaspresentedin
SIMPACT–T5.1|9
table3,andtheelementsthatmakeupthiscategorisation,thattheinteractionsbe-
tweenthedifferentcategoriesaredynamicandmutuallyinfluencingand“driveso-
cialinnovations’economicandsocialimpact”(Rehfeldetal.2015:44).
SIMPACTinvestigatestheeconomicfoundationofSocialInnovation,it’seconomic
under-pinning.Inthenextparagraphwethereforefocusontheeconomicframe-
work.
Social Economic Political
SocialInnovationComponents
TypesofSIActors
- Informal:e.g.citizensini-tiatingcivilsocietypro-jects,crowds,founda-tions
- Formal:NGOs,associa-tions
- Socialentrepreneurs;- For-profit-companies- Publicenterprises- PPPs
- Politicaldecisionmakersat:Local,regional,na-tional,European,globallevel
SIResources - Education- Social/relationalcapital- Meansofprotest/leader-
ship
- Productionfactors:la-bour,capital,land,knowledge
- Righttovote;- Social&humanrights;- Ideologies
SIInstitutions - Culture- Traditions- Conventions- Legitimacy
- Markets- Sectorrules- Milieus
- Educationsystem- Welfaresystem- Lawsandpoliticalstruc-
tures- Participationrights
SocialInnovationObjectives
SIMotives,objec-tive(aimedim-pact)
- Empowerment- Participation- Socialcohesion- Equity
- Profitmaximisation- Pareto-optimum
- Welfaremaximisation;- Inclusion- Dischargeofpublic
budget- Legitimation
SocialInnovationPrinciples
SocialInnovationEfficiency(di-lemma’s)
- Unclearwhatefficiencymeans(inrelationtoeco-nomicandpolitical)
- Contextualembeddedvs.de-contextualiseddiffu-sion
- Internalaswellasexter-nalefficiency
- Staticvsdynamiceffi-ciency
- Competitionvscollabora-tion
- Shorttermvslongterm- Autonomyvspublicfund-
ingdependency
SocialInnovationGovernance(modes)
- Withorwithoutgovern-ment
- Withorwithoutgovern-ment
- Publicregulation
Table3. AcategorisationofSIComponents,Objectives&Principles
10|SIMPACT–T5.1
3.3 TowardsanEconomicFrameworkofSI
There is no denying that SI is the ‘new kid on the block’ as a societal driver of
change,andconsequentlyalsoininnovationresearch.Itlagsbehindinshowingits
importanceforeconomicdevelopment,andhastocatch-upwithotherformsofin-
novationinraisingawarenessof itsrole invaluecreationandeconomicgrowth.
Wewillthereforefirstdiscusstheeconomicunderpinningsofotherformsofintan-
giblesandotherformsofinnovation,namelyfirstintheprivatesector(firms)and
subsequently thepublic sector.Thediscussionbasically concerns the claim that
someexpendituresonintangiblesshouldnotbeseenascosts,butasinvestments,
becausetheyincreasetheproductivecapacityinthefuture.However,theseintan-
giblesareveryhardtomeasure,andthefuture(returnoninvestment)maytake
quiteawhiletomaterialise.Whenexpandingtheframeworkbyaddingthepublic
sector,andfinallythecivicsector(includingcitizens,households,communitiesand
thirdsectororganisations),itbecomesevenhardertodoso.Withthesethreesub-
sectors,wewillsubsequentlysuggestasystemiceconomicframeworkofSI(onein
whichinvestmentinSIwillleadtoeconomicbenefits),anddiscussitatmicro-level
andmacro-level,referringtosomeSIcasestudiesandliterature.
OurfocusinthisparagraphwillbeonSIasaninputtoeconomicgrowth.Wewould
liketorefrainfromcomplicatingthediscussionatthisstagebyextendingtheanal-
ysisbeyondGDPandwelfare,andtowardshumanwellbeingandqualityoflife,but
doneed topoint toworkdoneon this topicbyPouw&McGregor (2014).They
broadenthenarrowviewofwelfaretohumanwellbeingbydefiningthelatteras“a
state of beingwith others and the natural environment that ariseswhere human
needsaremet,whereindividualsandsocialgroupscanactmeaningfullytopursue
theirgoals,andwheretheyaresatisfiedwiththeirwayoflife”(Armitageetal.,2012:
3).Thisconceptionofwellbeingtakesintoaccountthematerial,relational,andcog-
nitive/subjectiveaspectsofpeople’sneedsandgoalsinlife.Thisabilitytopursue
goalsinlifeisalsocentralintheapproachtakenbyCRESSI(HoughtonBuddetal.,
2015;NichollsandEdmiston,2015).Althoughthesenon-material,intangible,goals
arevery important for those involved inSI,wewould like to focusonthe ‘hard’
materialobjectiveintermsofforinstanceGDP/capita.Thisisnecessarytoconvince
thosewhodonot,atthefirstinstance,careaboutthemore‘soft’passions,purposes,
andgoals(forpeopleandsocietyasawhole),orevenabouthowwelfareisdistrib-
uted,thatinvestinginSImakessense.
SIasaninputforeconomicgrowth
SIMPACT–T5.1|11
3.3.1 InvestmentbyFirmsinIntangibles&itsEconomicImpact
AsStiglitzetal.(2009:144)pointout,economistsareincreasinglyconfrontedwith
the challenge ofmeasuring ‘intangibles’ in the economic system, because an in-
creasingshareof investmentsandan increasingshareofoutputsare intangible,
anditisdifficulttoestimatethemarketvaluebycapitalising/monetisingthesein-
tangibles.Wefirst lookatvariousresearchprogrammes,whichhavestudiedthe
impactofinvestmentinintangiblesbyfirmsoneconomicgrowth.
TheINNODRIVEresearchprojectforinstanceaimedtoprovidenewdataonintan-
giblecapitalandtoidentifyitsimpactoneconomicgrowth.Inthepast,economic
growthcouldbeexplainedbyinvestmentinmanufacturing,improvementsinedu-
cational attainment and investment in R&D. But, this is not enough to explain
growthperformancetoday.TheresultsoftheINNODRIVEprojectshowedthateco-
nomiccompetencerelatedtoorganisationalcapitalofmanagementandmarketing
isoneofthekeydriversofgrowth.Thestudyrecognisestheneedtotreatintangi-
blesas investments,creating futurevalue, rather thanas intermediatecosts. IN-
NODRIVEproducednewestimatestocapitalisetheintangiblesfollowingthe(CHS)
approachofCorradoetal.(2006),buttheyhavealsoadvancedthisapproachby
developingnewdataonintangiblesusingbothexpenditureandperformancebased
estimatesofintangiblecapital.Besidesinnovativeproperty(R&Dandlicencecosts)
and computerised information (software and databases), this new approach in-
cludedeconomicandfirmcompetencesi.e.spendingonreputation(advertising),
firm specific training and organisational capital. They have added items, which
wereoftenexcludedfromboththebookkeepingsystemsofcompaniesandthena-
tional system of accounts. After including all these additional intangible invest-
mentsbyfirms,theGDPintheEU27areais5.5%higher(Piekkola,2011).Thisin-
deedshowsthat, inthewordsofCorrado(2012):“thetraditionalcapitalestima-
tionsareunderstated,becausemanycostsof innovationarenotcountedas invest-
ment”.This isan important implicationof themacro-economicmeasurement,or
capitalisationapproachofCorradoetal.(2006)whohavestatedthat:“anyuseof
resourcestodaydesignedtoincreasetheproductivecapacityofthefirminthefuture
isinvestment”
AnotherresearchprojectCOINVESTconfirmedforaselectionofEuropeancoun-
trieswhathadalreadybeendocumentedfortheUS,namelytherapidgrowthof
investmentsbycompaniesinR&D,salesandmarketing,andorganisationalcapital,
andthattheseinvestments,whichtheycollectivelycalledintangibles,areanim-
portantdriverofoutputgrowthandcompanyvalue.Theydefinedanintangibleas-
setorintangibleinvestmentas:
ResearchonIntangibles
12|SIMPACT–T5.1
“identifiable non-monetary assets that cannot be seen, touched or physically
measured,whicharecreatedthroughtimeand/oreffortandproduceanenduring
knowledgeasset[...]Someknowledgeassetsareprotectedbyformalmeanse.g.trade
secrets(e.g.,customerlists),copyrights,patents,andtrademarks.Othersarenot,such
asknow-how,knowledge,collaborationactivities,leverageactivities,andstructural
activities.”(Haskel&Edlin2010)
Thefocusinthisdefinitionisonknowledge,whereespeciallythemeasuringofthe
valueof the investmentsorassetsregarding informalknowledge ishardtoesti-
mate.Althoughalargepartoftheintangiblesarestilllacking,theresearchshowed
forinstancethatinmanufacturing,intangibleinvestmentexceedstangiblesinall
theselectedEUcountries.Infinanceandbusinessservices,thereverseisthecase
(Haskel&Edlin,2010).
Regarding innovations in firmsSchumpeterdistinguishedbetween fivedifferent
typesofinnovations:
1. Introductionofnewproducts.
2. Introductionofnewmethodsofproduction.
3. Exploitationofnewmarkets.
4. Creationofneworganisationalstructuresinanindustry,
5. Developmentofnewsourcesofsupplyforrawmaterialsorotherinputs.
Ineconomics,mostofthefocusovertheyearshasbeenonthefirstandthesecond
ofthese(thelastone,onnewinputs,ishardlyreferredtoanymore).DataonR&D
expenditurebyfirms(whichismostlyspentonproductinnovation)islargelyavail-
able,andnot longagothesocalledBarcelonaobjectiveofreaching3%R&Dex-
pendituresasashareofGDPhasbeenthekeytargetinaimingforeconomicdevel-
opmentintheEU.Togetherwithorganisationalinnovationandmarketinnovation
(alsoreferredtoasnon-technologicalformsofinnovation)thesefourtypesofin-
novation(seefigure2)arestilldistinguishedintheOsloManual1(theinternational
standardguidelineonhowtomeasure innovation)and inmany innovationsur-
veys,suchastheCommunityInnovationSurvey(CIS).However,thedistinctionbe-
tweenthesefourtypesofinnovationdoesnotcaptureverywellthefactthat(espe-
ciallyconcerningservicedesignanddevelopmentofnewbusinessmodels)innova-
tioninvolvesnewcombinationsofthesefour,whichareoftenveryhardtoseparate
fromeachother(seeFigure2).Thisisespeciallythecaseconcerningnewservices
andnewbusinessmodels(aswellasforSI).
1 Although,whatSchumpeterreferredtoas‘marketinnovation’,hasbeenchangedintheOsloManual
andCISintonewmarketingmethodsorinnovativemarketing.
SIMPACT–T5.1|13
Figure2. Schumpetertypesofinnovation
Whileaninventionconcernsthecreationofthefirstideaofanewproductorpro-
cess,innovationreferstotheuseofthisnewandbetterideaormethod,theattempt
totryitoutinpracticeandtobringitonthemarket,ordeliveritasapublicservice
(Fagerberg, 2013). So where inventions can be seen as technological ‘break-
throughs’inscience,innovationscanbeseenas‘breakthroughs’inmarketsandso-
cieties. Schumpeterdescribed thiswithhis conceptof creativedestruction.This
conceptismoredynamicthentheneoclassicalstrandofeconomicsthatemerged
bythen,andthataccordingtoSchumpeterwasatoopassiveviewoneconomiclife.
Hewanted toexplain that:“a sourceofenergywithin theeconomic systemwhich
would of itself disrupt any equilibrium that might be attained”. (Schumpeter,
1937/1989:166).Innovationisthisdynamicsourceincapitalism.
Inordertoturnaninventionintoaninnovation,aninnovativeentrepreneurcom-
binesseveraldifferenttypesofknowledge,capabilities,resourcesandskills.The
personororganisationalunitwhichcombinesall these factors innewwayswas
labelled‘entrepreneur’.
So,forSchumpetertheconceptofinnovationwasindeedcloselyrelatedtoentre-
preneurship.Althoughheoftenwroteaboutitasaperson(andissometimescriti-
cisedforthat),hereferredtotheentrepreneurialfunctionofcomingtonewcom-
binations,whichreplaceoldones(Fagerberg,2014).
Service InnovationNew Business Model
Process Innovation Market Innovation
Product Innovation Organisational InnovationR&D
Designingnewcombinations
Innovationsasbreak-throughs
Innovativeentrepre-neur
14|SIMPACT–T5.1
Figure3. TEPSIE’sIntegratedmodelformeasuringSI
Source:AdaptedfromKrlevetal.(2014)
Sincehewasoftheopinionthatscientistsshouldleavequestionsthatariseoutside
theboundariesoftheirowndisciplinetoothers,hestucktoeconomics.But,this
doesnotimplythattheentrepreneurialfunctionofcomingtonewcombinations
cannotbeperformedbyan‘EntrepreneurialState’(Mazzucato2013a),orasocial
innovator.InthisrespectKrlevetal.(2014:209)refertothenotionofsectorneu-
trality,since‘socialinnovationcanoccurinanysector’,and‘entrepreneurialactiv-
ity’isthereforecentralintheirmacro-modelformeasuringSIwhichhasbeende-
velopedundertheTEPSIEproject(Figure3)
3.3.2 AdditionalIntangibles&InnovationsinthePublic&CivicSector
Sowhatcanwesayabouttheroleofintangiblesandinnovationinvaluecreation
inthepublicandcivicorthirdsector?Whatkindofcapitalorintangiblesarewe
actuallytalkingabout?
Forthesocialorcivicsector,wecanthinkofsocialcapital.TheIAREGforinstance
hasanalysedtheroleofintangibleassetsonregionaleconomicgrowthinEurope.
Theprojectidentifiedfourkeyintangibleassetsimpactingongrowth:knowledge
capital,humancapital,socialcapitalandentrepreneurshipcapital.Therearesev-
eraltheoreticalexplanationsfortheimpactofsocialcapitaloneconomicgrowth,
SOCIETY
FRAMEWORK CONDITIONS
Political
SocietalClimate
Resources
Institu-tional
Innov. Perfor-mance
Organi-sationalOutput
SocietalOutcome
Proto-typing
Propo-sals
Sustai-ning
EntrepreneurialActivity
Entrepreneurial Activity Framework Conditions Society
Field-spectifc outcome and output
IntangibleAssets
SIMPACT–T5.1|15
e.g.:reducingtransactioncosts,or(assunktransactioncosts)reducingthecostof
transformation(includinginstitutionalchange),oritsimpacton‘spatialsorting’by
firmsorhumancapital(Storper,2011).Therefore,IAREGalsoanalysedtheensem-
ble effects of these intangible assets on the location of firms.2Also Soete et al.
(2009)reportonapositiveimpactonregionaleconomicgrowthfromsocialcapital,
whichiscapturedbyvariousindicatorsontrust.DeHaan(2015)showshow,ata
moregloballevel,aspectsofsocialcohesion(e.g.civicactivismandinclusion)relate
toeconomicgrowth(Figure4).
Figure4. Civicactivismandinclusioninrelationtoeconomicgrowth
Source:DeHaan(2015)
AccordingtoMazzucato(2013a)theroleofthepublicsectorinvaluecreationvia
innovationandhumancapitalformationisundervalued.Sheforinstancepointsout
thateverytechnologythatmakestheiPhoneso ‘smart’wasgovernmentfunded:
theInternet,GPS,itstouch-screendisplayandthevoice-activatedSiri.Mazzucato
showedthattheprivatesectoronlyhadthecouragetoinvestafteran‘Entrepre-
neurialState’madetheinitialhigh-riskinvestments.Moreover,unlikethepublic
sector,theprivatefinancialsectorhasratherextractedvalueanddidnotinvestin
theincreaseofinnovationcapacityorhumancapital.Mazzucatoalsocallsforare-
newedappreciationfortheroleofthestateconcerningvalue-creatinginvestments
intechnologicalinnovationandhumancapitalformation.In“aworldinwhichpri-
vatefinanceispursuingshort-termprofitsandfocusingonvalueextractionactivities,
oftenitisonlypublicfinancethatisabletoprovidethelong-termpatientcapitalthat
nurtureslearningandinnovation”Mazzucato(2013b:7).Itisnotonlythebankers
thatmakeitpossibletocarryoutthenewcombinationsassociatedwithinnovation
(Schumpeter1912,p.74)butalsoanentrepreneurialstatecanmakenewcombi-
nations possible. However, Mazzucato (2013a, 2013b) mainly refers to invest-
mentsinR&Dandeducation,andnotinSI.
Concerning the long- vs. short-term visionwith respect to investment,Hall and
Soskice (2001) have distinguished a number of varieties of capitalism. In some
2 http://cordis.europa.eu/result/rcn/46401_en.html
y = 0.0356x + 0.142
R2 = 0.3758
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0 2 4 6 8 10 12
ISD
Val
ue in
clus
ion
min
oriti
es
Ln GNI/Cap (ppp)
Growth & inclustion go together
0
0.2
0.4
0.6
0.8
0 5 10 15
Civic activism and GNI/cap (Ln)
Roleofpublicsector
Varietiesofcapitalism
16|SIMPACT–T5.1
countrieswithamore‘stakeholder’-typeofcapitalism,suchasGermanyandJapan,
bankshavebeenmorewillingtobe‘patient’financersofinnovation,moresothan
incountrieswitha‘shareholder’typeofcapitalism,suchasintheUSorUK,which
aremoredrivenbyquickreturnsandspeculation(TylecoteandVisintin,2008).
Capitalising(estimatingthemarketvalueof)intangiblesinfirmsisdifficult,butin
thepublicsectoritisevenmoredifficult,andcurrentlymostpublicexpenditures
arenotcountedasinvestments,butasconsumptionbecauseitisseenassatisfying
current collective needs, and not as services intended to create future societal
benefits.Corrado,etal.(2015)makessomesuggestionsonhowtoapproachthe
problems in capitalising public intangibles. After distinguishing various govern-
ment functions, they focuson the investments/assets concerninghealth, culture
andeducation(Table4).Acomplicationwhenextendingtheeconomicframework
byintegratingfunctionsofthegovernmentisthatgovernmentservesmorefunc-
tionsthen‘economicaffairs’,andalsomorethan‘socialprotection’.Thisexplains
whyalmosteachministryinEuropehasdesignedaninnovationstrategyorsystem
ofits’own(silo)toservetheneedsofsocietyintheconcerningpolicydomain.In
this respect, many kinds of innovation (public innovation, business innovation,
technical and non-technical, ICT-innovation, organisational innovation, SI, etc.)
havebecomepervasive,servingmultipleorgeneralpurposes,whichopenspossi-
bilitiesfornewcomplementarycombinations.
Table4. Classificationoffunctionsofgovernment(COFOG)
FUNCTION
� Generalpublicservice1 � Housing&communityamenities
� Defense � Health
� Publicorderandsafety � Culture&recreation3
� Economicaffaires � Education
� Environmentalprotection � Socialprotection4
1 Includesinterestpayments2 Transportationaffairs,generaleconomicandlabouraffairs,agriculture,energyandnaturalre-
sources3 Alsoincludesreligion4 Disabilityandretirementincome,welfareandsocialservices,unemploymentandothertransfersto
persons
Source:Corradoetal.(2015:4)
BasedonthesameCHSlogicthatwasappliedtofor-profitbusinessactivities,Cor-
radoetal.(2015)proposethreenewcategoriesofpublicinvestment:
1. investmentsininformation,scientific,andculturalassets
2. investmentsinorganisationalcompetencies
Publicintangibles
SIMPACT–T5.1|17
3. socialinfrastructure.
Justifyingtheneedforthislastcategory,whichincludeshumanknowledgecapital
andhumanhealth,theyrefertolong-lastingsocietalassets.
Weintenttoextendtheeconomicframeworkbeyondtheprivateandpublicsector.
InthisrespectaninterestingprojectisITSSOIN,whichisaEuropeanresearchpro-
jectthatstudiesthe‘ImpactoftheThirdsectorasSocialInnovation’.Inoneofits
deliverablesAnheieretal.(2014)statethat“theabilitytofostersocialinnovationas
ameansofenhancingsocialproductivitymaynotonlyresultintheproductionofdif-
ferentsortsofcapital(Bourdieu,1986),butalsodependontheorganisations’capac-
itytotapintothem.Thirdsectoractorsmaynotgenerallypossessahighlevelofeco-
nomic capital but they can draw on other sorts of capital, for instance, on social
(whichisvitaltothemobilisationofstakeholders)orculturalcapital(valuesandvir-
tuesthatarecrucialfortheabilitytogainlegitimacy).Wemightadd,‘public’or‘po-
liticalcapital’.
Basedonmacroindicatorscapturingthesizeofthethirdsectorandforcivicen-
gagement(volunteersinthethirdsector)theyprovideaframeworktoestimatethe
SIpotential(seeFigure5).Thesetwocomponentscanberegardedaskeyforindi-
catingthesupplysideofSI.
Figure5 Categorisationofaggregatedsocialinnovativeness*
Source:Anheieretal.(2014)
CzechRepublic Sweden
Denmark
Spain
Italy
UKNetherlands
Germany
France
SI smallest
SI medium
SI medium
SI highest
CIVIC ENGAGEMENT**
SCAL
E OF
TH
IRD
SECT
OR*
LARG
ESM
ALL
LOW HIGH
All of relations are in relative and not in absolute terms.
(*) Scale of the third sector is measured primarily by engagement in welfare activities, then by share of paid national workforce and third by share of GDP
(**) Civic engagement is indicated by volunteers as % of employment in the third sector.
18|SIMPACT–T5.1
InSIMPACTwehavetakenthevariouswelfareregimesinEuropeasbroadersocial-
institutional contexts forSI (Rehfeldetal.2015).Anheieretal. (2014) fromthe
ITSSOINprojecthavealsostudiedhowthe(aforementioned)varietiesofcapital-
ismserveasaneconomic-institutionalcontextforSI.Theyshowhowwelfarere-
gimes(associalcontexts)andvarietiesofcapitalism(aseconomiccontexts)relate
toSIandillustratewherecontradictionsoccuracrosstheseclassificationsandtheir
implicationsforSI.TheyconcludewiththetentativehypothesesthattheSIpoten-
tialofthethirdsectorincreases:
• “With thenumberofmulti-stakeholdercontacts (including thecontacts to
thecommercialandpublicsphere,civicengagement);
• With the diversity of the resource base (including diversity in financial
sources,volunteering,expertise,andknowledge);
• Withtheformulationofvaluesetsthatcan‘connect’toothersintermsofso-
cialmobilisationsanddissemination.”(Anheieretal.2014).
Pouw&McGregor(2014)takeanevenmorepluralisteconomicperspective.Build-
ing onPolanyi (1944), they see economic relationships as being embedded in a
broadercontextconsistingofapoliticalrealm,asocietyandcultureandanatural
andbuiltenvironment3.Fromthisperspective,theydefinetheeconomyasthein-
stitutedprocessofscarceresourceallocation,byandtoeconomicagents.Besides
theprivateandpublicsector,theydistinguishathirdeconomicsectorconsistingof
individuals,householdsandcommunities,andeachof thesethreesectorsordo-
mainshasitsarchetypeallocationmechanism:marketexchangeintheprivatesec-
tor,redistributioninthepublicsector,andreciprocityinthecivicsector(Figure6).
Thisframeworkallowstheauthorstostudytherolesthatmarkets,politicsandso-
cietyplay.Inaddition,itenablesthemtostudyhowtheyinteracttoshapetheeco-
nomic processes and outcomes fulfilling people’s needs and goals (Pouw &
McGregor2014).
Inmainstreameconomics,expensesbycitizensarecountedasconsumption,and
notasinvestments.But,evenwhensomeexpensesbyindividualsandhouseholds
wouldbecountedasinvestments(e.g.inhumanorsocialcapital)theidentification
of reciprocityasan importantallocationmechanism in thecivic sector,explains
whycapitalisationormonetisationofintangiblesinthissectorisverycomplicated.
Comparedtotheprivatesectoritisfarmoredifficulttomeasureorestimatethe
inputsandoutputsintermsofmarketvalueorexchangevalue.
3 AlsotheCRESSIprojecttakessuchamultidimensionalperspective,whichisalsoappliedtoamulti-
dimensionalperspectiveonmarginalisedpeople,innovationandcapabilities,seefigureainAppen-
dix
Welfareregimes
Economyasinstitutionalprocess
ofscareresourceallocation
SIMPACT–T5.1|19
Figure6. Keyallocationmechanismsinthethreeeconomicdomains
Source:Pouw,N.&A.McGregor(2014)
Thechallengeistoconstructacitizen’sversionconcerningtheir‘productivecapac-
ity’oftheearliermentionedstatementofCorradoetal.(2006)that:“anyuseofre-
sourcestodaydesignedtoincreasetheproductivecapacityofthefirminthefutureis
investment”.Inacitizen’sversion,SIinputswhichempowermarginalisedgroups
insociety,andincreasecapabilitiestopursuetheir‘productivegoals’shouldindeed
beseenasinvestments,notascostsorconsumption.Thefourcasestudyexamples
describedintheappendix(textboxI)allinvolveamixofresourceinputsdesigned
toincreasecertaincapacitiesofthevulnerablepeopleinvolved.
InthecaseofVoorleesExpressthekeyresourcesarevolunteers,thetargetedcapa-
bilitiescomprisereadingskillsofchildrenof2-8yearsold;skillsthatareappreci-
atedbylabourmarkets,andcanbeturnedintoexchangevalue10to15yearsafter
VoorleesExpresswhen the kids have grown up and get there first job. Funding
mostlycomesfromlocalpublicgovernments,whichenablesthesocialinnovatorin
itsentrepreneurialfunctionofcomingtoimprovedcombinationsofresourcesfrom
thepublicsector,privatesectorandcivic/thirdsector.
AmajorcomplicationinthecaseofinvestmentsinSIisthattheyareoftendesigned
toincreasetheproductivecapacityofthesectorscombined,theyservethegoalsof
variousstakeholdersfromthethreesectors.Anotherwaytoputit:thevalueadded
ofSIisinthesynergiesbetweenthepublic,privateandcivilsector.Thisalsoimplies
thateconomicimpactnotonlycomesfromtheenhancedcapabilitiesofthepeople
inthetargetgroups,andtheenhancedgrowthofthesocialinnovator,butthereare
Individuals, Households & Communities
reciprocity
Allocation of scare
resources as an instituted
process
PublicSector
redistribution
Private Sector
marketexchange
ExampleVoorleesExpress
20|SIMPACT–T5.1
oftenalsocontributionstotheeconomicimpacttobefoundinthepublicsectorand
theprivatesector.
InthecaseofWORK4ALL,aprojecttacklingyouthunemploymentinducedbylocal
publicprocurementwithsocialreturnobjective(seetextboxIinAppendix)allof
theinvolvedstakeholdersintheSIinvestandeachofthesestakeholdersgetadif-
ferentkindofeconomicreturnontheirinvestment.Theunemployedyouthworks
atlowcostbutgetfreetraining.Theeducationinstituteandtheconstructioncom-
panyinvestedinnewtrainingmethodsandguidanceandthisexperiencecanbe
usedforacquiringnewassignments frompublicprocurement.The localgovern-
mentinvestsintheprocurementanditsprocedure,butforinstancehopestosave
moneyonareductioninunemploymentbenefits.ThejointdevelopmentofthisSI
onlyworkswhentheinvestmentisacombinedeffort.
Asaworkinghypothesis,wecometothefollowingeconomicframeworkofSI(Fig-
ure7).TheinputstoSIcomefromavarietyofresourcesandcapabilities,fromthe
civic,theprivateaswellasthepublicsector.Asanadditionalsourceofvariety,SI
bringsnewcombinationsofsocial,economicandpublic/politicalresourcesandca-
pabilities,which in interactionmaycreatemoreeconomicgrowththanprevious
combinations(Figure7).
Figure7. TheEconomicframeworkofSI
TheinvestmentsinSIinitiativesorprojectscombinethesocial,economicandpo-
litical resources and capabilities of the involved (civil-social/economic/public)
stakeholders.Thecontributiontoeconomicgrowthnotonlycomesdirectlyfrom
thegrowthorincreasedcapabilitiesofthesocialinnovatororSocialEntrepreneur.
Italsocomesfromtheimpacttheseinnovatorsandentrepreneurshaveonothers
insociety,e.g.mostnotablyfromtheincreasedcapabilitiesofthetargetedbenefi-
ciariesinthesocial/civilsector,butalsofromtheimpactontheusersoftheinno-
vation inthepublic/politicalsector,andthe impactonthedonors intheprivate
sector,etc.
Invest in SI EconomicGrowth
as new combinations ofsocial, economic andpolitical capital
and social benefits
ExampleWORK4ALL
SIMPACT–T5.1|21
Atthemicro-levelwerefertotheResourceBasedViewonthis.TheResource-Based
View(RBV)ofthefirm(Penrose,1959),builtonSchumpeter’sperspectiveonvalue
creation(Fagerberg,2014),viewsthefirmasabundleofresourcesandcapabilities.
Appliedtosocial innovatorswecouldsaythatfromasetofscarceresourceswe
shouldnotexpectastrongbusinessstructure.Structuralresourcegapsarebridged
byvolunteers,throughuseofpersonalprivateassets,withstrongpersonalcom-
mitmentofpeopleworkingintheorganisation,andwithastrongorientationon
achievingimpactfortheirtargetgroup.Withtheirfocustoinvestinothers,theydo
oftenforgettoinvestinthemselves.However,theResource-BasedViewalsostates
thatbyuniquelycombiningasetofcomplementaryandspecialisedresourcesand
capabilities(whichareheterogeneouswithinanindustry,scarce,durable,noteas-
ily traded,anddifficult to imitate), this iswhat leadstovaluecreation(Penrose,
1959).Therefore,thescarcityofacertainresourcecouldbecompensatedbyan-
otherspecificresourceorcapability,andtheRBVisaboutthisuniquecombination.
TheResource-BasedViewfitsthesituationofSIquitewellasstatedbyRehfeldet
al.(2015),butthekindofresourceswhicharekeyinSIareoftendifferentfrom
thoseforothertypesofinnovation,e.g.volunteersareakeyresource.
Forinstance,intheSIcaseofVoorleesExpress(seeAppendixTextboxI)volunteers
investtimeinreadingwithyoungchildrenwhichlacklanguageskills.Forthesocial
innovatorwhohasdevelopedandimplementedthemethodthesevolunteersarea
keyresource.Sincehalfofthelocalorganisationshavedifficultiesinacquiringvol-
unteersthesocialinnovatorinvestedinamarketingstudytofindoutwhichkind
ofpeoplearemostinterestedtoreadasvolunteerswiththechildren(forwhomit
ismostrewarding).Oneofthemaintypesoftheresultingmatrixconcernswoman
whoseownchildrenlefttheirhometoliveontheirown.Anothertypeconsistsof
firstyearstudentswhocometoliveinanunfamiliarcity.Forthemitisaniceway
togettoknowthecityandintegrateintheirnewenvironment.Thisexampleshows
whatkindofvaluecreatinginvestmentsaremadebysocialinnovators,whatkind
ofresourcesare tobesecured,andhowdifficult it is toestimate therelatedex-
changevalues.
InallthefourexamplesofSIprovidedintheAppendix,studentsandeducationin-
stitutesplayaroleasaresource.However,notthetechnologicaldisciplines,but
socialsciencesandhumanities.E.g.,social innovatorsseldomconductimpactas-
sessments,butintheirannualreportsandtheirvaluepropositionssocialinnova-
torsrefer torelevantstudies fromsocialscientistsascircumstantialevidenceto
backuptheirvisionandproposals.
TheexamplesofSIsprovidedintheAppendix(TextboxI)showthatindeedthey
canbeseenas‘bundlesofresourcesandcapabilities’,asnewcombinationswhich
havebeendevelopedbysocialinnovators.Thesenewnichesintegrateresourcesof
thecivic,publicandprivatesectorandhavebeenmadepossiblewithfundingfrom
Resource-basedview
22|SIMPACT–T5.1
allthesethreesectors.Besideseconomicresources,thesocialresources(e.g.work-
ingwithvolunteers)orcapabilitiesandpoliticalresourcesandcapabilitiesareof-
tenmoreprominentassets,e.g.inrelationtoservetheneedsofbeneficiariesorin
lobbyingforpublicgrants.Acoreobjectiveforabouttwothird(72%)oftheSIM-
PACTcasesistoempoweranddevelopcapabilitiesofthemarginalisedandvulner-
ablebeneficiaries(Terstriepetal.,2015).Accordingto(Santos,2012)thisempow-
ermentofothers,outsidetheboundariesoftheorganisation,isakeycharacteristic
ofsocialentrepreneurs.
TeeceandPisano(1994)appliedthisRBVviewofthefirmtoinnovationandex-
tendedit intotheconceptof“dynamiccapabilities”,definedas“theskills,proce-
dures,organisationalstructuresanddecisionrulesthatfirmsutilisetocreateand
capturevalue”(Teece2010:680).Thesetwoviewsarequitesimilar,butthemain
differenceisthattheRBVisastaticapproach(totheallocationofresources,andto
efficiency),whilethelatterdynamicconceptrefersalsototheabilitytointegrate,
build,andreconfigureinternalandexternalcompetencestoaddressrapidlychang-
ingenvironments.Inthisrespecttheconceptissimilartothatofresilience,which
isoftenusedatasystemslevel.So,theRBVonlyaddressesefficiencyinrelationto
currentvaluecreation,whiledynamiccapabilitiesrefertodynamicefficiencyand
thecapabilitiestocreatevalueinthefuture.This“dynamiccapabilities’conceptis
lesswellapplicabletoSIasacharacterisation,butitseemsapplicableinexplaining
someofthebarriersofSI.socialinnovatorsdonotinvestenoughindevelopingdy-
namiccapabilities,routineswhichempowerthemtoaddresstheuncertaintiesof
the future; relational routines, broadened perceptions and changed awareness
whichmakes themselvesmore resilient and capable.The lackof investments in
buildingupdynamiccapabilitiesisevidencedinTerstriepetal.(2015),e.g.:inthe
formofalackofmanagerialknowledge(p.51),andskills(p.48).Socialinnovators
shouldempowerthemselvesincooperationwiththeirsurroundingeco-systemof
innovationinwhichtheirmainbeneficiaries,aswellastheirpartnersareembed-
ded.InassessingtheimpactofSIanassessmentoftheincreasedcapabilitiesofthe
socialinnovatorshouldbeincluded.Mostattentioninevaluationsandimpactas-
sessmentsofSIaredevotedtotheeconomicimpactonothers,e.g.onthosewho
fundandusetheSI,suchaslocalpublicgovernments,andtotheeconomicresults
forthebeneficiaries(inourcasethemarginalisedtargetgroups)andthewiderin-
directsocietaleconomicimpactthatgeneratesfromthat.
Dynamiccapabilities
SIMPACT–T5.1|23
3.3.3 UseValue&ValueCo-CreationinaSystemicService-logicofSI
Thevaluecreationconceptofmosteconomictheoriesisbasedongoodsandex-
changevalue,whileforSIalogicofvaluecreationbasedonserviceandusevalue
wouldbemorerelevant.Theconceptofresourcesinservice-dominantlogic(Vargo
etal.2008)hasbeenshapedbytheresource-basedview.Theconceptofservice-
dominantlogicmakesadistinctionbetweenuse-valueandexchangevalue.Vargo
etal.(2008)describehowtheconceptsofuse-valueandexchangevaluehavebeen
addressedintheeconomicliterature;andbefore,sincetheGreekphilosopherAr-
istotle (384–322 BC) was first to distinguish between use-value and exchange-
value(Fleetwood,1997).AdamSmith(1776/2000:31)referredto‘‘value-in-use’’
and ‘‘value-in-exchange’’, but emphasised the latter, and economic theorieshave
sincefocusedonexchangevalue.IncludingthoseofMarx:althoughhehadalsodis-
tinguisheduse-valuefromexchangevalue,hismainpointwasabouttheunfairex-
changebetweencapitalandlabour.Asopposedtoa‘goods-dominantlogic’Vargo
etal.(2008)proposea‘service-dominantlogic’,basedon‘value-in-use’,or‘value-
in-context’(seeTable5).
Service is defined as the ‘‘application of specialised competences (knowledge and
skills)throughdeeds,processes,andperformanceforthebenefitofanotherentityor
theentityitself’’(VargoandLusch2004:2).Servicecanbeseenasthefundamental
basisofexchange,andgoodscanbeseenasadistributionmechanismforservice
provision.Anadvantageofthisframeworkisthatitunifiestheexchangemecha-
nismsofthecivic,publicandprivatesectordomainaspresentedbeforeinFigure
6.
Table5. ExchangevalueinGood-Dominantlogicvs.Use-valueinService-Dominantlogiconvaluecreation.
Good-Dominantlogic Service-Dominantlogic
Valuedriver Value-in-exchange Value-in-useorvalue-in-context
Creatorofvalue Firm,oftenwithinputfromfirmsinasupplychain
Firm,networkpartners,andcustomers
Processofvaluecrea-tion
Firmsembedvaluein‘‘goods’’or‘‘ser-vices’’,valueis‘added’byenhancingorincreasingattributes
Firmsproposevaluethroughmarketofferings,customerscontinuevalue-creationprocessthroughuse
Purposeofvalue Increasewealthforthefirm Increaseadaptability,survivability,andsystemwellbeingthroughservice(ap-pliedknowledgeandskills)ofothers
Measurementofvalue Theamountofnominalvalue,pricere-ceivedinexchange
Theadaptabilityandsurvivabilityofthebeneficiarysystem
Resourcesused Primarilyoperandresources Primarilyoperantresources,some-timestransferredbyembeddingtheminoperandresources-goods
Good-dominantlogicvsservice-dominantlogic
24|SIMPACT–T5.1
Good-Dominantlogic Service-Dominantlogic
Roleoffirm Produceanddistributevalue Proposeandco-createvalue,provideservice
Roleofgoods Unitsofoutput,operandresourcesthatareembeddedwithvalue
Vehicleforoperantresources,enablesaccesstobenefitsoffirmcompetences
Roleofcustomers To‘useup’or‘destroy’valuecreatedbythefirm
Co-createvaluethroughtheintegra-tionoffirm-providedresourceswithotherprivateandpublicresources
Source:Vargoetal.(2008)
Value realisation takesplace inuseof services (or indeedgoods) referred to as
‘value-in-use’or ‘value-in-context’, inotherwordsuserscontinuethevaluecrea-
tionprocessthroughuse.WhenweapplythistoaSI,whichempowersvulnerable
people,theimpactindeed,keepsincreasingeachtimethesebeneficiariesusethe
capabilitiestheyhavedevelopedbecauseoftheSI.Intheexamplesofthecaseof
VoorleesExpressandMothersofRotterdam(seeAppendixTextboxI)thisisactu-
allywhytheseSIsaddresscertainproblemsataveryearlyphaseinlife.Theearly
inlifeinvestmentsinpersonaldevelopmentandskillsarethemostefficient,asthey
givethehighestreturnoninvestment.
Inrelationtoservice(orresource,orintangibles,orknowledge)thereisadifferent
meaningoftheword‘use’fromthetraditionalmeaninginrelationtogoodswhere
‘use’and‘consume’referto‘useup’and‘destroy’.InaService-Dominantlogicusers
co-createvalue.TheinfluenceoftheRBVisevidentinthefollowingstatement:
“Moving the locus of value creation from exchange to use, or context,means
transformingourunderstandingofvaluefromonebasedonunitsoffirmoutputto
onebasedonprocessesthatintegrateresources”.(Vargoetal.2008)
Figure8. Valueco-creationinaservice-systemsperspective
Source:Vargoetal.(2008:149)
Value-in-ExchangeValue Proposition/
Money
Value-in-Context for Service System 1
Access, Adapt and Integrate Resources
Service System 1(Firm)
Value-in-UseDerived Value
Service System 2(Customer)
Value-in-UseDerived Value
Value-in-Context for Service System 2
Access, Adapt and Integrate Resources
Service System(Public)
Service System(Private)
Service System(Market-facing)
Service System(Public)
Service System(Private)
Service System(Market-facing)
Value-in-use
Valueco-creation
SIMPACT–T5.1|25
AlthoughVargoetal.(2008)oftenrefertoaservicefirmandaservicecustomer
(seeFigure8),theymentionthatwecanalsoconsiderindividuals,groups,organi-
sations,firms,andgovernmentstobeservicesystems,oranyothersocialoreco-
nomicactorthatcantakeaction,applyresources,andworkwithothersinmutually
beneficialways.Thischaracterisationverymuchappliestothewiderangeofstake-
holdersinSI.
In theservicedominant logic, the firmcannotdelivervalue,butonlyoffervalue
propositions(Table6).‘‘[T]hereisnovalueuntilanofferingisused–experienceand
perceptionareessentialtovaluedetermination’’.Thisimpliesthatofferingsmustbe
integratedwith theresourcesofothermarket-facing (i.e., fromotherfirms)and
non-market-facing(e.g.,personal/privateandpublic)resourcesforvaluetobecre-
ated.Vargoetal.(2008)providetheexampleofacargainingitsvalueonlythrough
thecombinationofthemanufacturer’sproductionprocesses(includingitssupply
chainandothermarket-facingelements)andthecustomer’sprivate(e.g.,driving
skills)andpublic(e.g.,roadways)resources.
Table6. Foundationalpremisesofservice-dominantlogic
Serviceisthefundamentalbasisofexchange
Indirectexchangemasksthefundamentalbasisofexchange
Goodsareadistributionmechanismforserviceprovision.
Operantresourcesarethefundamentalsourceofcompetitiveadvantage
Alleconomiesareserviceeconomies
Thecustomerisalwaysaco-creatorofvalue
Theenterprisecannotdelivervalue,butonlyoffervaluepropositions.
Aservice-centeredviewisinherentlycustomerorientedandrelational.
Allsocialandeconomicactorsareresourceintegrators.
Valueisalwaysuniquelyandphenomenologicallydeterminedbythebeneficiary.
Source:Vargoetal.(2008)
InthecaseofSI,whenapplyiingthe‘Service-DominantLogic’thesocialinnovator
cannotdelivervalue,butoffermultiplevaluepropositions(comparedtothesingle
valuepropositionaspresentedinFigure8)tothevariousstakeholderswhopro-
videinputsorfunding.Thesocialinnovatorsareresourceintegrators,whocreate
valuebycombiningtheinputs(Figure9).
Applyingtheconceptofusevalue(orvalue-in-use,orvalue-in-context)andtheser-
vicedominantlogicimpliesthatitisdifficulttomeasureandmonetisesocialvalue,
that is, thevaluethatnongovernmentalorganisations(NGOs),socialenterprises,
Valuevsvaluepropositions
Socialinnovatorsasresourceintegrators
Socialvalueinser-vicedominantlogic
26|SIMPACT–T5.1
socialventures,andsocialprogramscreate.InthewordsofMulgan(2010:41)“So-
cialvalueisnotanobjectivefact.Instead,itemergesfromtheinteractionofsupply
anddemand,andthereforemaychangeacrosstime,people,places,andsituations”.
TheinteractionbetweenthedemandforSIandthesupplyofSIisnotmediatedby
price(exchangevalue).InthisrespectwecanrefertoLundvalls’(1992)theoryon
interactivelearningbetweenproducersandusersofknowledgeandinnovations.
Witholdtraditionalsolutionsboththeproducersandusersofthesolutionshavea
reasonable ideaabout theresultsand thevalue thesolutionwillbring,butwith
new,innovativesolutionsthedemand-sideandthesupply-sidewillhavetointeract
and learn fromeachother inorder to transformthe innovationandreach toan
improvedresult/value.ThisishoworiginalprototypesofSIgetchangedintomore
matureSIs,andhowSIsarediffused(orscaled-out)tootherusersandsituations.
InthecaseofVoorleesExpressandGranny’sFinest(seeAppendixTextboxI)the
proto-typeSIhasbeendiffusedtootherlocationswhereithasbeenappliedina
differentcontext,withdifferentpartners,withdifferentneedsandpotential.There-
fore,theapplicationoftheSIandtheresultsandvaluegenerateddiffersfromplace
toplace.
Sincethereismoretobecommunicatedbeyondprice,auctionsareforinstancenot
a good tool topromote interactionbetweendemandand supply for SI.One can
thinkofothertoolstopromoteinteraction,suchasorganisingeventswheresocial
innovators canpresentnew ideas forwhich juriesandaudienceaward thenew
idea’swithprizes.InthecaseofGranny'sFinest(seetextboxinAppendix)winning
suchasocialenterpriseawardwasthemomenttheydecidedtostart-upandthey
usedtheprizemoneytopaytherentofthefirstlocation.
Figure9. ConceptualframeworkofSIasvaluecreation
Demand for SI
Supply of SI
INPUT OF
NEED OF Business Sector Civic/Thrid Sector Public Sector
Business Sector Civic/Thrid Sector Public Sector
SIInteraction
Economic & Social Value
Output/Imapctof SI
Interactionbetweendemand&supply
SIMPACT–T5.1|27
AsexamplesofhowdemandandsupplyforSIcanexplaintheemergenceofSIand
thevalueitgenerates,werefertolocalinnovationstrategiesofmetropolitanareas
suchasStockholm,Hamburg,orAmsterdam,whichhaverelativelyhighsharesof
immigrantsandtheireconomicgrowthorientedinnovationstrategiesemphasise
thatwhentheywanttomaintaintheirinnovativecompetitivenessthatSIisneeded
toforinstancepromotetheintegrationofimmigrantsandthedevelopmentoftheir
capabilities.
Alsoafterthestart-upofVoorleesExpressandGranny’sFinest(seeAppendixText-
boxI) thedemandandsupplyconditionsexplainthediffusionoftheconcerning
SIs. ForVoorleesExpress an important supply-factor is the availability of volun-
teers;e.g.inthesouthernprovinceofLimburgithasprovenmoredifficulttosetup
suchlocalorganisationofvolunteers.ForGranny’sFinestitisimportanttobelo-
catedatanurbancarecentre(asco-funder)wheremanyelderly(effectedbylone-
liness)areconcentrated,whocaneasilyreachthecentre.
Onthedemand-sidethemarketfortheSIofferedbyGranny’sFinestalsoconsists
ofthecivic(consumer)demandforthesocialfashionproductswhichareknitted
byandreducesthelonelinessoftheGranny’s.Thedemandalsoconsistsofthede-
mandfromthelocalcarecompaniesforinnovativesolutionstoidentifyandengage
futureclientsinlonelinessreducingactivities.Theinterestorobjectiveofthelocal
governmentsisinthepositiveexternalitiesfromthesocialactivitiesonthehealth
and independency of the involved elderly,which could save public expenditure
budgets.
3.4 WhattoMeasureorIndicate?
Sincetherelationbetweensocialinnovatorsandtheirtargetedbeneficiariesissel-
domamarketrelationinwhichthebeneficiariespayfortheservicesascustomers
orconsumers,itisdifficulttomonetisetheexchange.Followingthetwopossible
optionsusedbymacro-economicstoestimatetheinvolvedincreaseinintangible
capitalwecouldeitherfollowtheexpenditure-basedestimatesofintangiblecapi-
tal,ortheperformance-basedestimate.Afterdiscussingtheproblemswiththe’10
bestwaystomeasureSocialvalue’Mulgan(2010)suggesttotaketheexpenditure
option (which he defines as ‘effective demand’) more serious. One of the ad-
vantages is that fundingandbudgetdata forSI isoftenmoreeasilyavailable,at
leastasthemeso-leveloforganisationsandprogrammes.Atleastthisexpenditure
datatellthatsomeone,suchaspublicagency,individualcitizens,orfoundation,is
willingtopayfortheoutcomes.
Asseenintheprevioussection3.3.3,thecreationofusevalueisanintegralpartof
SI.This interpretationof thevalueofSIdiffers fromtheoneused in theTEPSIE
Localinnovationstrategies
Expenditure-vsper-formance-basedesti-mates
28|SIMPACT–T5.1
reportonmeasurementofsocialeconomiesinEurope,wheretheauthorsdepart
fromthenotionthatSIsareinprinciple“valueneutral”(Hubrichetal.,2012).As
explained,wefollowtheideathatSIshavea"value-in-use",whichisalsoapparent
intheconceptofsharedvalue(KramerandPorter,2011).
PorterandKramer’sconceptofshared,socialvaluecreation(CreatingSocialValue)
isinspiring,andeventhoughitisclearlyanextensionofCSR(CorporateSocialRe-
sponsibility)principlesthereareanumberofelementswhichcanbetransferredto
SIbysimplyreplacing“corporate”by“society”(Figure10).
Figure10. TheCreatingSocialValueSpace
Source:PorterandKramer(2011)
Inthecontextofmeasurement,therealisationthatsocialneedsrepresentthelarg-
estun-servedmarketopportunitycombinedwiththerealisationthat(social)en-
trepreneurs,andperhapssocietyatlarge,needtocombinetheeconomicvaluewith
thesocialvalueofSIinordertoachievesustainabilityareatthebasisofthiscon-
cept.
Althoughweagreewiththeimportanceofsocially/missiondrivenorganisationsas
akeyactorinSI,asindicatedintheTEPSIEreport,wedoseetheseorganisations
asoneofmany(ThirdSector)actorsinthecivic,publicandprivatesectordomain
systemofSI.
InarecentpaperbytheOECD(2015),onfinancialinvestmentforsocialneedsand
impactmeasurement,anoverviewofplayersincludingthosefromtheThirdSector,
ENERGYUSE
SUPPLIERACCESS &VIABILITY
ENVIRON-MENTALIMPACT
COMPANYPRODUCTIVITY
WATERUSE
EMPLOYEESKILLS
EMPLOYEEHEALTH
WORKERSAFETY
- Social deficits and environ- mental impact create economic costs for companies
- Community weaknesses affect company produc- tivity
- Social needs represent the largest unobserved market opportunity
SIMPACT–T5.1|29
andtheirdemandandsupplyregardingfunding,havebeendescribedandvisual-
ised(Figure11).
Figure11. Socialimpactinvestmentmarketframework.
Source:AdaptedfromOECD,2015
!!!!"
SUPPLY SIDE- Governments- Foundations- Industrial investors- Philantrophists &
Family offices- Social venture funds- Retail
DEMAND SIDE INTERMEDIARIES- Social enterprise- Charities- Non-profit & Social
purpose organi- sations
- Co-operatives- Mutuals
- Social banks- Social investment
wholesale banks- Community Development
Financial Institutions- Social exchanges- Funds
Social Needs
Enabling Environment
Ageing, Disability, Health, Children & Families; Public Order & Safety, Affordable Housing, Unemployment
Social Systems, Tax Laws, Regulatory Environment, Financial Market Development
30|SIMPACT–T5.1
4 INDICATORSONSOCIALINNOVATION
4.1 SocialInnovationMeasurement
Much like the complainton “vagueness” thatwasmentionedby someof the re-
viewedauthors,insection3,onthedefinitionofSIwecanechothesameforthe
measurementofSI.AlthoughtheenvironmentinwhichSIfindsitplacemightnot
whollyconformtothepositivistviewofrationalandobjectiveaccountingtherecan
benodenyingthatinanopensocietythereistheneedforaccountabilityoforgan-
isationstowardstheirstakeholders.Acknowledgingthisrequirementfortranspar-
encytherehasbeenapushtocreatemeasurementframeworksforuseinanadmit-
tedlydifficultaccountingenvironment,whichdoesnotadheretothenormaleco-
nomic,andstatisticprinciples.
Althoughthereareseveralsourcescitingtheoretical frameworks forameasure-
menteffort atmacro level, inpractice thereare fewattemptsmadeempirically.
Among the most noteworthy academic efforts, are project related activities to
whichwehavealreadyreferred,suchasTEPSIE:Theoretical,EmpiricalandPolicy
FoundationsforSIinEurope,CRESSI:CreatingEconomicSpaceforSI,andITSSOIN:
‘ImpactoftheThirdsectorasSI’.However,mostempiricalworkisdonead-hocat
themeso-levelofprojects,anditismostlydonebyconsultants.StatisticsonSIas
suchdonotexistjet.InthischapterweaddressindicatorsofSI,butfirst,wegoback
inthepastbygivinganoverviewonmeasurementofmoretraditionalformsofin-
novation.
Themeasurement of (economic/industrial) innovation has been researched for
somedecadesnowandweshouldfirsttakealookattheliteraturewhichresulted
fromthisresearch.AfterinstigationofSchumpeterseveralstepsweretakenwhich
ledtoNelsonetal.’s(1962)“RateandDirectionofInventiveActivity”inwhichfore-
most Kuznets’s article “Inventive Activity: Problems of Definition andMeasure-
ment”isquiteapplicabletoourcurrentproblem.Inconsecutivewavesmorework
wasdonewhichultimatelyledtothepublishingoftheOECDFrascatiandOsloMan-
uals(resp. 1994and1997).Bothmanualsnowcountasdefinitesourcesforthe
collectionandinterpretationofinnovationandR&Drelateddata.Itwouldthere-
forebeopportunetohaveanideaoftheapproachtakenbythesemanuals,inpar-
ticularbytheOsloManualwhichfocusesdirectlyonthemeasurementofinnova-
tion(anditsdifferentfacets).
SIMeasurement’svagueness
Measurementofeconomicinnovation
SIMPACT–T5.1|31
The Oslo Manual details five types of innovations as proposed by Schumpeter
(1912):
1. Introductionofnewproducts.
2. Introductionofnewmethodsofproduction.
3. Exploitationofnewmarkets.
4. Creationofneworganizationalstructuresinanindustry,
5. Developmentofnewsourcesofsupplyforrawmaterialsorotherinputs.
Obviously,thistypologyisalmostexclusivelyfocusedonindustrial/economicin-
novations.However,thisdoesnotexcludetheinformativevalueandinsomecase
directtranslatablenatureofthistypology.AswealreadyhaveseenSIsunlockser-
vicesandmarketsformarginalisedcommunities.SIsalsoaimatbuildingcapacities
(andcapabilities)whicharedirectedatsolvingsocietalproblems.Lastly,SIsfocus
onprocesses involved inorganisingand facilitatingnovelwaysof (social)work,
socialaction,andadjustmentstosocialstructure.Hencewecouldrewritethety-
pologyasfollows:
1. Introductionofnewsocialproducts(BonchekandChoudary,2013)
2. Development/buildingofcapacitiesandcapabilitiesdirectedatsolvingsoci-
etalproblems
3. Creation of new, and adjustments to existing, market/social structures
(Swedberg,1994)directedatimprovingaccesstosuchmarket/socialstruc-
turesformarginalisedcommunities.
4. Introductionofneworganisationalprocessesaimedat(social)workandso-
cialaction
5. DraftinginnewsocietalplayersintheSIeconomicframework.
Althoughindirectlyrelatedtoourgoals,andfocusedontheinvestmentframework
foraddressingsocialneeds, theaboveFigure11doesgiveusaclear ideawhich
indicatorsanddata-pointscanbeenvisagedtoplayanimportantroleinourmeas-
urementframework.Wecanseesupplyanddemandsideactorsaswellastheser-
vices/productsforwhichinvestmentisnecessaryintermsofsocialneedse.g.soci-etalproblems.ThisframeworkcanbemergedwithourSIstypologybylookingat
the characteristics of each of the market frameworks’ main influencing actor
groupsandenvironments.
Typesofinnovation
Typesofsocialinnovation
32|SIMPACT–T5.1
4.2 Information&DataforSIMetrics
As seen in theprevious chapterwe find that themeasurement of SI is all but a
straightforwardexercise.Inconstructingaframeworkformeasurementweshould
takecare to includeall theearliermentionedaspects.However, it ispractical to
departfromtheexistingdatasourceswherewecouldfirsttakeinthepossibletra-
ditionaleconomicactivitymetricssuchasturnover,expenditureandemployment
inthesector.Athirdandforthissectoruniquemetricwouldbethemeasurement
ofvolunteerinputintermsofmanpowerandtimeexpendedonvolunteering.Next
tothesetheThirdSectorhasanotherquantifiableactivity,whichisatadmoredif-
ficultasitismadeofdifferentcomponentsandevendiffersperNPO:income(An-
heier,2004).Incomeinthissectorisofcoursequantifiablethroughmeasuringdo-
nated funds, however there are twomore possible income flows; subsidies and
saleswhicharepotentiallymeasurable(Salomon&Anheier,1996).
The“usevalue”fromtheseactivities,however, is lesseasilymeasurable,at least
not inthetraditionalway.Ethical,environmental,humanrights,communityand
societalbenefitsarealllesseasilyvisibleandmeasurableastheyconcernnon-fi-
nancialandnon-physicalresourcesbuttheyarethemaincontributorstohuman
welfareorbettersaidwell-being.Butevenifthisusevalueisnotdirectlyvisible
therearestilldataandinformationthatcouldbegatheredonimportant“Usevalue”
componentssuchas:
• trustingovernment,institutions,policies,thirdsectorinitiativesand
communityactions(Nicholls,2009);
• interestin,andrecognitionof,theneedsofmarginalisedcommunities;
• capacitiesto,resolveproblems,addressneedsandconflictinginterests,
andactonemergingconflicts;
• participationincommoncauses,workingforthecommongood.
Thesedatacanbetranslatedintometrics,but,itmustberememberedthatthese
metricsandtheirderivedindicatorsarecontextsensitiveandoftenaddressspecific
societalconcernsandstakeholderneeds.
Societalconcerns/stakeholdersneeds SourcesofInformation Metrics
Well-being Poverty,health,education,empowerment,discrimina-tion
PovertyreductionImprovementinaccesstohealthcareIncreasingeducationalattainment(formalandinformal)Genderbiasreductionthroughtheempow-ermentofwomenEliminationofgender/education/income-baseddiscriminationandmarginalisationofdisadvantagedcommunities
Existingdatasourcesaspointoforigin
Measuringusevalue
SIMPACT–T5.1|33
Societalconcerns/stakeholdersneeds SourcesofInformation Metrics
Participation Socialprogramsandactions Numberofpeopleconsulted,numberofparticipants,durationofparticipation
Inclusiveness Inclusion/exclusionofbenefi-ciaries;Geographical,gen-der,educational,andsocialrepresentativeness
Numberofbeneficiariesperterritory,gen-dergroup,educationalattainmentgroup,andorothersocialgroupingspecifictothecontext.
Transparency Accesstoinformation,free-domofspeechandpress,butpossiblyalsocorruption
Numberofnewsoutletsetc.,freedomofspeechmetrics,corruptionmetrics
Accountability Socialresponsibility,visiblethroughinternalandexter-nalreviewsandaudits
Numberofauditsdoneperproject,feed-backandresponserates.
Efficiency Proceduresimplementedtoimproveefficiency;reducecost,increaseaccessibilityandencouragestakeholderinvolvement
Numberofbeneficiariesinvolved,moneysexpendedandaccessibilitybeforeandafterimplementationoftheprocedureorim-provement.
Effectiveness Input,through-putsandout-putsusedformeetingthein-tendedtargets(suchasin-creasedwell-being)
Numberofinterventionsandprogramsstartedunderaproject,Nr.ofbeneficiariesreached(withapositiveoutcome),etc.
Quality QualityassuranceinSIser-vicesandproducts,expecta-tionsandsatisfactionlevelsofstaff,stakeholdersandbeneficiaries
Existenceofprotocols,feedbackfromstaff,stakeholdersandbeneficiaries
Table7. Aneeds-solutionsmeasurementframework
BasedonworkdonebytheCGG(2005),theabovetablesummarisestheseoutlined
concernsandneedswhilerelatingthemtothepossiblesourcesofinformationand
themetricthatcouldresultinameaningfulindicator.
4.3 Micro-levelofSI,Innovators,Beneficiaries&Initiatives
TheinformationandrelationshipsbetweenSIComponents,Objectives,andPrinci-
plesasshowninTable3,andtheargumentsfurtherlaidoutinchapter3bothun-
derlinethatSIhastobeanalysedinaholisticwaywhichdoesnotonlyfocusonthe
organisationperformingtheSIbutalsoconsideritsembeddednessinasocio-eco-
nomic,politicalandculturalcontext.Forinstance,theconditionofthewelfarestate
inwhichanSIemergesandoperatesdeterminestoa largedegreetheproblems
(market failures,welfare state imperfections)and the targetgroups thatSImay
tackle,andthewaysinwhichthesecanbetackled.Tothisend,SIMPACTdistin-
guishesthreedimensionsofSIs,objectives,principlesandcomponents(seeabove).
34|SIMPACT–T5.1
Nevertheless,thecasestudiesexaminedinWP3oftheSIMPACTprojectillustrate
thatthereareanumberofproblemsthatemergeattheleveloftheSIorganisation
itself,namelyproblemsinsecuringthesustainabilityoftheorganisationthatper-
formstheSI.Thisobservationcallsforanumberofindicatorsthatmeasureperfor-
mance and impact of SI at themicro-level. To this endwe refer to thebusiness
modelcanvasofOsterwalder&Pigneur(2010)whichhasalsobeenunderlyingthe
analysisofcasestudiesinWP4.
ThecurrentresultsofSIMPACT(WP3&4)illustratethatmanySIstendtoidentify
targetgroupssolelyby thesocialneed that theyaimtoaddressbutdonotcare
(much)aboutthesizeofthesegroups,howtheycanbereachedbest(ataffordable
costs),andtowhatextentthesegroupsmayallowforscaling,whichincludesan
assessmentofthemarketsizeandtype(e.g.itsgeographicalscope).Finally,given
the focus on the social need, questions like the purchasing power of the target
groups or the identification of additional target groups to which SI services or
goodscanbesoldareoftenneglected.
MostSIshaveparticularstrengthsintheidentificationofsocialproblemsthatare
notsolvablebymeansofthemarketorthewelfarestate.However,theresultsof
SIMPACTsuggestthatmanySIstendtowardsconsideringtheirsolutionasaunique
andisolatedserviceanddonotconsiderwhatalternativeorcomplementaryser-
vicesareorcanbeprovidedbyotheractors.
ThenarrowperspectiveonthesocialmissionthatcharacterisesmanySIsalsoaf-
fectsthevalueproposition.Asexplainedinsection3,forSIs,usevalueistypically
more important than exchange value. However, every organisation that creates
goodsorserviceshastoachieverevenuesatleasttocoverthecoststhatareinevi-
tablyalignedwithsuchanendeavour.Asexplainedinsection3,co-creationplays
animportantroleforSIstorealisevalue.Therefore,itappearsnecessaryforSIsto
identifyco-creationpartnersthathelptotransformthesocialvalueorusevalue
proposedbytheSIintoexchangevaluethathelpstheSItogeneratelong-termrev-
enues.Theseco-creationactorsarenotnecessarilylimitedtothetargetgroupsof
theSI’ssocialmission.Exchangevaluecanalsobeco-createdbythewelfarestate,
bycommercialcompaniesorbyothersocialactors,suchasfoundations.Manyhy-
brid SIs provide examples for this co-creative transformation of use value into
(monetarisable)socialvalue.
AsthecasestudiesofSIMPACThaverevealed,manySIsarenotawareoftheirde-
pendenceoncertainpartnersandof therisks the initiative isalignedwith.This
unawarenessoftenresultsinproblemstooptimiseprocesses,decision-making,re-
sourceallocation,qualityassuranceandtofindanadequatelegalformfortheSI.
Problemsinsecuringsustainability
Definitionoftargetgroupsbyso-
cialneeds
SIsemphasisesocialmission
SIMPACT–T5.1|35
Finally,theregulatorycontextinwhichtheSIevolvesisadecisivefactorfortheSI’s
successandsustainability.However,inmanycasesthiscontextisonlyconsidered
withregardtofailureswithinthiscontext(definingthesocialproblemtargetedby
theSI)buthardlywithregardtoresourcesprovidedbythiscontext.
Regardingobjectives,micro-levelindicatorsofSIshouldprimarilyeasetheassess-
mentofthesustainabilityandimpactoftheSIwithregardtothetargetgroups,the
socialproblemthatcharacterisesthem,andthevalueproposition/noveltyintro-
ducedandofferedbytheSI.
Micro-levelindicatorsoftheeconomicimpactandsustainabilityofSIsattheobjec-
tiveslevelshouldcoverthefollowingaspectsandquestions:
• Goaldefinition:Whatisthesocialproblemaddressedandhowpersistentisit?TowhatdegreehelpstheSItosolvetheproblem?Whataretheshort-
term,mid-termandlong-termgoals?
• Costs:IsthereaclearcostcalculationofallactivitiesandplansoftheSI?
• Exclusiveness/complementarity: Do other actors address the socialproblemidentifiedbytheSI?Ifso,aretheofferingsoftheseotheractors
competitiveorcomplementarytotheofferingsoftheSI?
• Outcomes:HowmuchwouldtheorganisationearnfromtheactivitiesoftheSI? Howmuchwouldthewelfarestateorcompaniesorothersocial
actors benefit (e.g. in form of savings or reaching formerly unreachable
groups)fromtheactivitiesoftheSI?
Regardingprinciples,micro-levelindicatorsofSIshouldprimarilyeasetheassess-
mentoftheorganisationalcontextoftheSI,itsprocesses,itseffectivenessandeffi-
ciency,anditsbusinessmodelandgovernance.AsthecasestudiesofSIMPACThave
revealed,manySIsarenotawareoftheirdependenceoncertainpartnersandof
theriskstheinitiativeisalignedwith.Thisunawarenessoftenresultsinproblems
tooptimiseprocesses,decision-making,resourceallocation,qualityassuranceand
tofindanadequatelegalformfortheSI.Micro-levelindicatorsoftheeconomicim-
pactandsustainabilityofSIsattheprincipleslevelshouldcoverthefollowingas-
pectsandquestions:
• Organisationaldependencies:Whatlegalformhasbeenchosenbywhichcriteria?Onwhatpartners/externalactorsdoestheSIrely?Aretheroles
oftheseorganisationsclear?Isthereawarenessof/aplanforhowtherela-
tionships to these organisations change over time? Are theremeans or
planstoreducethedependencyonexternalorganisations?
• Technologicaldependencies:DoestheSIrelyonanytechnologicalinno-vation?
Regulatoryframe-workasdecisivefac-tor
Objective-relatedSIindicators
Principles-relatedSIindicators
36|SIMPACT–T5.1
• IPR:DoestheSIhave(thepotentialfor)ownershipofanyintellectualprop-erty?DoestheSIrelyonIPRofthirdparties?
• Organisationaldevelopment:Aredevelopmentstagesdefinedandcrite-riaidentifiedthathelptodecidewhentheSIshouldmove(inbothdirec-
tions)fromonestagetoanother?Arethereclearrulesfordecision-making
andconflictresolution?
• Scale:Howmanypeopleareaffectedbyit?
• Scope:What is the geographical scope of the target groups that can beservedbytheSI?
• Scaling:IsthereanopportunityforscalingtheSIupordownifthe“mar-ket”conditionschangeovertime?
• Riskassessment:Arepotentialrisksidentifiedandmitigationstrategiesdeveloped?
• Sustainability/revenues:Can(apartof)thetargetgroupspayforgoodsorservicesofferedbytheSI?Isthereanadditionaltargetgroupthatcan
affordpayingfor(additional)goodsorservicesprovidedbytheSI?Would
publicauthoritiesorfoundationsfinancetheSI?Forwhatperiodoftime
andwhatpurposeswouldpublicfundingorfundingfromfoundationsbe
available?IsthereaplanhowfinancingoftheSImaychangeovertime,at
differentdevelopmentstages?
• Qualityassurance:Aretheremeans(e.g.userfeedback)toevaluatequal-ityoftheprovidedgoods/servicesandtoimprovequalityifnecessary?
• Monitoring:AretheremeansinplacethathelptheactortomonitorandevaluatethedevelopmentandoutcomesoftheSIwithregardtoitsobjec-
tives?
Regardingcomponents,micro-levelindicatorsofSIshouldprimarilyeasetheas-
sessmentoftheregulatorycontextoftheSI.Regulatorylimitationsandopportuni-
tiesareatthefocusinthisregard.Micro-levelindicatorsoftheeconomicimpact
andsustainabilityofSIsatthecomponentslevelshouldcoverthefollowingaspects
andquestions:
• Regulatoryactors:Haveregulatoryactorsbeenidentifiedandhastheir(potential)role(supporting/hampering)fortheSIbeenclarified?Arecon-
ditionsunderwhichsupport fromtheseactors isprovidedorrefusedor
discardedclarified?
• Policycoherence:DoestheSIexplicitlydirectlyaddressobjectivesortar-getsidentifiedinlocalornationalpolicyframeworks?DoestheSIcontra-
Component-relatedSIindicators
SIMPACT–T5.1|37
dictsuchpolicyframeworks?IstheSIawareofthecriteriabywhichpolit-
icalactorswouldevaluatethesuccessoftheSI?WouldtheSIbeallowedto
affectsuchpolicyframeworks?
SIsareusuallyawareoftheimportanceofthepolicycontextinwhichtheyoperate,
thoughmostlywithinalimitedperspective.ManySIsrespondtosocialproblems
thatarenotefficientlyaddressedbysocialpolicyandformanySIspublicbodies
playavitalroleforfinancing.However,hardlyanySIundertakeseffortstosystem-
aticallyevaluatingitspolicycontextwithregardtothesupportivenessoftheor-
ganisationsgoalsandbusinessmodel.
AstheresultsofSIMPACTshow,publicpolicyisexcessivelyfocusedonshortterm
funding,quantifiableoutcomes,politicalfashionandmediaimpact(Totterdilletal.,
2015).Thisoftenresultsinlimitedimpacton“landscapechange”,weakcorecapac-
ity in NGOs, a preference for bureaucracy instead of policy entrepreneurship, a
dominanceoftransactionalinsteadoftransformationaldialogue,fewspacesforin-
novation, conservative interventions, and the undervaluation of intangible out-
comes(ibid.).AnSIshouldthereforecarefullycheckitspolicycontextwithregard
tofollowingaspects(Totterdilletal.,2015):
• Arepublicorganisationsfirforpurpose,especiallywithregardstoorgani-
sationalstructures,staffempowermentandentrepreneurialbehavior?
• Aremodesofpolicyproduction(bureaucratic,programmaticoropen)fit
forpurpose?
• Areserviceusersconsideredasactivepartners?
• Does the relation between public bodies and the SI allow for creating a
sharedvision,acommonunderstandingofeachpartner’srole,andtrans-
formationaldialoguethatvaluesdifficultquestionsandallowsfortaking
risks?
Anexampleofapracticalapproachincorporatingtherequirementslaidoutabove
isprovidedbytheNewEconomicsFoundation(NEF).Theypresentanarrayofin-
dicators4onmicro andmacro levels.The indicatorsprovided target individuals,
communities,theenvironmentandtheeconomy.
Attheindividuallevel,NEFsuggestedthatindicatorscover;well-being,skillsde-
velopment,health,andhigh-riskbehaviour. Inorder tomeasureasocial inven-
tion’simpactonanindividual’swell-being,NEFsuggestsamodelofwell-beingwith
twopersonalandonesocialdimension.Thepersonaldimensionsarepeople’ssat-
isfactionwiththeirlives(includingwork)andtheirsenseofpersonaldevelopment.
4 http://www.proveandimprove.org
Publicpolicy
Example:NewEconomicFoundation
38|SIMPACT–T5.1
Thesocialdimensionshallcapturepeople’ssocialwell-beingasindicatedby“be-
longingtotheircommunities,apositiveattitudetowardsothers,feelingthatthey
arecontributingtosocietyandengaginginwhatcouldbecalled‘pro-socialbehav-
iour’.”
People’sownassessmentoftheirsatisfactionwiththeirlifeisafundamentalindi-
catorforallsortsofmethodsgearedtowardsmeasuringpeople’swell-being.Such
measuresareusuallyaccompaniedbyquestionsabouttheextenttowhichpeople
areaffectedbyfeelingsoffear/anxiety,guiltiness,sadness,happiness,excitement,
confidenceorinterestedness5.
Finally,accordingtotheNEF,indicatorsofwell-beinghavetoincludeameasure-
mentoftheextenttowhichpeoplefeelthemselvesbelongingtoacommunitywhich
memberstheytrustandtowhichtheycontribute.Alsodesirablearetheadditions
of a number of questions capturing people’s relationships to partners, family,
friends,andotherpeople,aswellasquestionstomeasurepeople’ssatisfactionwith
theirjobs,voluntarywork,leisureactivities,andtheirperceivedfeelingofsafety.
InordertomeasuretheimpactofanSIonanindividual’sskillsdevelopmentand
profile,e.g.throughtrainingcoursesthataimtoincreasetheindividual’sattractive-
nesstoanemployerandofitsself-confidenceandwell-being,NEFsuggestsarange
ofquestionsthatshouldhelpdemonstratingthatachangehashappened.
Thesequestionscoverincreasingpeople’sskill/competenceinsocial interaction,
increasingpersonaleffectivenessandaptitudeandlifeskills,andincreasing‘basic’
workskillsandattributes:
1. Indicatorstargetingpeople’sskillsandcompetenceinsocialinteractionask
for:
• Relationshipswithpeers
• Relationshipswithpeoplein‘authority’positions
• Abilitytoworkinateamwithotherpeople
• Increaseinsocialnetworks
• Increaseintoleranceofothers’differences.
2. Indicatorsofpersonaleffectivenessandaptitudeandlifeskillsaskfor:
• Improvedabilitytoplan
• Improvedabilitytoprioritise
• Abilitytoreasonverbally
• Numericalreasoning
• Increasedproblem-solvingskills
5 Amethodological“gap”notidentifiedbyotherinitiatives,andaddressedbyusinsection6.
Peoples’skills&competence
SIMPACT–T5.1|39
3. Indicatorsof‘basic’workskillsandattributesasfor:
• Attainmentofbasicliteracy(reading,writing)
• Basicnumericalskills,includingabilitytomanagemoney
• Timekeeping,reliability
• Abilitytocompleteforms
• CompletionofaCV
• Improvedpresentationskills
• Appearancesuitabletotheworkplace
Giventhecomplexityofpeople’shealth,forhealthindicatorsNEFsuggestsacom-
binationofself-reportedanddirectlyobservedindicators inordertogetamore
holisticpictureofaperson’sphysicalormentalhealth,includingphysicalandmen-
talhealthaswellasanindividual’sprivateandsocialbehaviours(e.g.substance
abuseandpreventivemeasure) thataffect theirhealth. Indicators in this regard
mayaskfortheperson’sratingofhis/herhealth,visitstoGPorothermedicalcare,
weight(gainedorlostasneeded),improvementofconditionthatwaspresentupon
referralorentrytotheorganisation,orforspecificproblemssuchastiredness/fa-
tigue,poorappetite,nauseaandthelike.
Furthermore,indicatorsmeasuringpeoples’highriskbehaviourcoverpatternsof
behaviourthatresultinharmtothemselvesortootherpeople.Suchpatternsmay
beexpressedthroughdrugoralcoholabuse,riskysexualbehaviour,orbehaviour
alignedwithpoorlivingconditions(e.g.homelessness).
TheindicatorssuggestedbyNEFrefertoanumberoftestedandpublicallyavaila-
blemethodsand instruments, suchasNEF’swell-beingmanifesto, theMaudsley
AddictionProfile(MAP),andtheChristoInventoryforSubstance-misuseServices
(CISS) Manyoftheseindicatorsmeasurepeople’swell-beingthroughaseriesof
questionsthatmustbeansweredbytherespondentsonaLikertscale.
4.4 Macro-levelofRegions&Countries
Economic metrics and the resulting indicators at the macro level are normally
abundantandofhighqualityatthenationallevelintheformofnationalaccounts
andothermorededicatednationaldata.Thisisespeciallytrueformost,ifnotall,
EuropeanUnionmemberstatesandOECDmemberstates.InrecentyearstheEu-
ropeanUnionandtheOECD,havebeengearingtheirdatacollectionmoreandmore
towardsregionalcollectionofwhichthewell-knownNUTSclassificationisanex-
ponent.TheuseofsurveysuchastheCommunityInnovationSurvey6,fortheEu-
ropeanUnion,anditsspin-offinnovationpanelsinseveralother(OECD)countries
6 SeeEUROSTAT:http://ec.europa.eu/eurostat/web/microdata/community-innovation-survey
Self-reported&directlyobservedindicators
Patternsofbehaviour
Nationalaccounts
40|SIMPACT–T5.1
havealsoproducedhighqualitydataonthedynamicsofinnovation.Thesemetrics
areused, amongothers, in scoreboards like theUnion InnovationScoreboards7,
capturinginnovationusingabroadeconomicframework.
Asmentionedthroughoutthisreportthecapturingofthesocialdimensionofinno-
vationhasnotbeenanintegralpartofthiseffort,butwehavealsoseenthepossi-
bilitiesforafutureinclusion.Thiscouldbeaffectedbytheinclusionofmetricsfrom
surveyssuchastheonefeedingtheOECDBetterLifeIndex8,ortheEuropeanSocial
Survey9.Thislastsurveyalsousesamixedmethodologywhichpotentiallycouldbe
thewayforwardincollectingcontextualdataonthesocialdimensionofinnovation
whilstpreservingtheearliereconomicfocus.
TheprojectITSSOIN: ‘ImpactoftheThirdsectorasSI’ takesaskeyindicatorsto
measurethepotential(supply-side)ofSIthesizeofthethirdsectorandtheshare
ofvolunteersinthethirdsector(Table8).
Table8. Paidemployeesandvolunteersasashareofthirdsectorworkforce(FTE),in%
Country(Year) Paidemployees(%) Volunteers(%)Changepaidemployees
(sinceyear)
CzechRepublic(2011) 79 21 +18%(2005)
France* 65 35
Germany(1995) 62 38
Netherlands(1995) 62 38
Spain(2002) 59 41 -9%(1995)
Median 59 41
Denmark(2004) 56 44
Italy* 55 45
UntitedKingdom 50 50
Sweden(2002) 22 78 +/-0%(1992)
(*)Countrydataisbasedonestimatesinunpublishedmaterial
Source:Anheieretal.(2014)
Perhapsthemostcomprehensivesetof indicatorsforSIatmacrolevelhasbeen
suggestedbytheearliermentionedTEPSIEproject.However,inpracticeitstillis
toalargeextendawish-listforindicators,sincedataisnotavailableforeverycoun-
tryinEurope,andthedefinitionsoftheavailabledataareoftennotcomparable.
ThequantificationeffortforSIwillneedtofallbackonthemorereadilyavailable
7 SeeEuropeanCommission:http://ec.europa.eu/growth/industry/innovation/facts-figures/score-
boards/index_en.htm
8 SeeOECD:http://www.oecdbetterlifeindex.org/
9 SeeNorwegianSocialScienceDataServices(NSD)and:http://www.europeansocialsurvey.org/
Macro-levelindicators
SIMPACT–T5.1|41
metrics,whichcanbeadaptedand interpreted foruse ina “landscaping” todis-
coverthepotentialandpropensitytoSociallyInnovateintheEU28.Inadditionto
theTEPSIEframework,wewouldliketogivemoreattentiontothedifferencesin
thedemandforSI,whichintheTEPSIEmodel(whichisfocusingonthesupply-side
ofSI)hasbeenhiddenunder‘frame-workconditions’.
Table9. TEPSIEStructureoftheblueprintofSIindicators
FrameworkConditions
ResourcesFramework FinancialResources
HumanResources
InfrastructuralResources
InstitutionalFramework NormativeInstitutions
RegulativeInstitutions
Cultural-cognitiveinstitutions
PoliticalFramework PolicyAwarenessaboutSI
PoliticalEnvironment
SocietalClimateFramework SocialNeeds/DemandsasreferencepointforSI
SocialEngagement/Attitudes
EntrepreneurialActivities
InvestmentActivities ExpenditureinInnovationbySI
ExpenditureinInnovationbyPublicSector
Start-upsActivities Start-upsandDeathRatesofFirmsdedicatedtoasocialpurpose
BusinessEnvironmentforStartingaBusiness
Collaborative&NetworkActivities
Citizens’Involvementinsocialentrepreneurialactivities
ClusterDevelopment
OrganizationalOutput/Socie-talOutcome
Education EqualityOpportunities/Inequalities
SkillAcquisition
Health&Care Access/QualityofHealthFacilities
HealthStatus&Research
Employment Jobs&Earnings
Work&Life
Housing HousingSituation
Access&Quality
SocialCapital&Networks Frequency&Quality
SocialCohesion
PoliticalParticipation Voting&BeingInformed
Citizens’activeInvolvement
Environment Patents&Certificates
PreservationofNaturalCapital
Source:Krlevetal.(2014)
Still,mostofthesub-headingsofthisframeworkprovidethekeyindicatorsetto
measureSI.ThisframeworksuggestedbytheTEPSIEproject(Hubrich,2012)and
afollowuppaperbyKrlevetal.(2014)consistsofeconomic,sociallyorientated,
and more general (including technological and business) innovation oriented
42|SIMPACT–T5.1
macroindicators,(seeTable9).Inthenextparagraphthisindicator-sethasbeen
refined:e.g.more focusedonSI,and thedemand forSIhasbeencapturedmore
prominently.Moreover,indicatorshavebeenchosenforwhichdatahasagoodcov-
eragefortheEU.
4.5 SuggestedIndicatorSets
Thereisevenscopeforapplyinganindicatorsetattheregionallevel,forsomein-
dicatorsdataisevenavailableatNUTS3level.SinceSImostlytakesplaceinalocal
context,theregionallevelseemsveryrelevant.Alsotheinclusionofmorecontex-
tual,qualitativeandquantitative,dataisanoptionthroughuseofsourcessuchas
theearliermentionedEuropeanSocialSurveyandadeeperinterpretationofthe
dataprovidedbystandard,buthighlyrelevant,sourcessuchastheEUStatisticson
IncomeandLivingConditions(SILC)andtheEULabourForceSurvey(LFS).The
resultingindicatorsetofmacro-levelindicatorsispresentedbelowindifferentor-
ganisationalforms.
InTable10belowweshowacategorisationoftheSIcomponents,objectivesand
principlesaspresentedinsection3.2,andthesuggestedmetricsthatareableto
informontheseelementsofSI.
Table11displaysthesuggestedindicatorsetofmacro-levelindicatorsintheform
astheabovepresentedblueprintofTEPSIE.Themainindicatorheadingsreferto
economicandsocialresourcesorcapital:Labour,Financialcapital,PublicCapital,
Knowledge,SocialCapital,andHealth.SinceSIMPACTdoesnothaveathematicfo-
cusonSIsaddressinghealth,thislastmoduleislessrelevantfortheSIMPACTanal-
ysis.AdistinctionhasbeenmadebetweenindicatorscapturingSIpotential(orsup-
ply)andthoseindicatingSIneedsordemand-side,whichbothindicatestheobjec-
tives(asaimedoutput),butalsoservesasoutput-indicators.Alsoadistinctionbe-
tweentangibleandintangibleindicatorsismade.Thecontributiontothepotential
orneedsmaycomefromeitherthepublic,private,orcivic/thirdsector.
Inanexttable(Table12)thefocusisonthetangibleaspects,oratleastthoseas-
pectswhichcanbemonetised/capitalised,andtheyarepresentedinausetableor
asortofinput-outputtablewithSIenablersontheonesideofthematrix,andSI
beneficiariesontheotherside.
Table13displaystheindicatorquestionswhichhavebeenusedtostandardisethe
characteristicsofthevariousaspectsofSIatthemicro-(meso)levelofSIprojects
andcasestudiesastheyhavebeenempiricallycoveredbySIMPACTinworkpack-
age3.
SIMPACT–T5.1|43
Table14showsina2x2matrixthelinkbetweentheabovementionedsetofmacro-
indicators(forcountriesandregionsinEurope)andthemicro-levelindicatorscol-
lectedfortheSIcase-studiesofSIMPACT.Theindicatorsareagaindifferentiated
betweentangibleandintangibleaspectsofSI.
SIMPACT–T5.1|44
Table10. AcategorisationofSocialInnovationcomponents,objectivesandprinciples,andpossiblemetrics(usingexistingdatasources)
SOCIAL ECONOMIC POLITICAL
Description Metrics Description Metrics Description Metrics
SIComponents
TYPESOFSIACTORS Informal:e.g.citizensinitiatingcivilsocietyprojects;crowds;foundations
CrowdfundingAnalyticsWorldGivingIndexDAFNE;CharitiesandFounda-tionsdata
Socialentrepreneurs; ThirdSectorImpact;ITSSOINStart-ups:LMPexpenditurebytypeofaction:EUROSTATlmp_expsumm
Politicaldecisionmakersat: Publicemploymentstatisticspercountry,perministry.
Formal:NGOs,associations UnionofInternationalOrgani-sationsdatabase
For-profit-companies; Highgrowthenterprises(NUTS3)inNACERev2Q88:SocialWorkActivities:Euro-stat
Local,regional,national,Euro-pean,globallevel
Publicemploymentstatisticspercountry,perministry.
Education Educationalattainment:Euro-stat:Populationbyeduca-tionalattainmentlevel,sexandage(%);edat_lfs_9903Eurostat:Earlyleaversfromeducationandtraining;edat_lfse_14
Publicenterprises StructuralBusinessStatistics;EUROSTAT;t_sbs
PPPs WorldBankPPPinInfrastruc-turedatabase
SIRESOURCES Social/relationalcapital WorldValuesSurveyEuropeanSocialSurvey;NumberofvolunteersEUTaxandBenefitsdatabase:Peoplewantingtowork
Productionfactors:labour,capi-tal,land,knowledge.
Economicallyactivepopula-tionbysex,age,etc.EURO-STAT:lfst_r_lfp2acedu
Social&humanrights;Righttovote
HumanRightdata:HumanRightsWatch,CIRIHumanRightsProject.FreedomofInformationGenderequality;unemploy-mentbysex,jobmobility,Peopleatriskofpoverty;EU-ROSTATilc_peps01
Meansofprotest/leadership PewResearchCenter Ideologies PewResearchCenter
SIMPACT–T5.1|45
SOCIAL ECONOMIC POLITICAL
Description Metrics Description Metrics Description Metrics
SIINSTITUTIONS Culture EurobarometersurveyEUROPELIST:OnthesearchforaEu-ropeanculture
Markets Annualsectoraccounts:EUROSTAT:t_nasa
Educationsystem; Pupil-teacherratioinprimary,loweranduppersecondaryeducation.EU-ROSTAT;educ_isteNumberofeducationalinstitutionspercapitaetc.
Traditions Eurobarometersurvey Sectorrules OECDProductMarketRegulationStatis-tics
Welfaresystem;Lawsandpoliticalstructures;
Individualsreliantonsocialsecuritybenefits;
Conventions Eurobarometersurvey Milieus Participationrights WorldValuesSurveyEuropeanSocialSurvey
Legitimacy Eurobarometersurvey
SIObjectives
SIMOTIVES/OBJECTIVE(aimedimpact)
Empowerment; WorldValuesSurveyEuropeanSocialSurvey
Profitmaximisation Annualsectoraccounts:EUROSTAT:t_nasa
Welfaremaximisation
Participation; WorldValuesSurveyEuropeanSocialSurvey
Pareto-optimum Inclusion ESSindicators:TrustinParliamentTRSTPL,TrustinLegalSystemTRSTGLetc.
Socialcohesion WorldValuesSurveyEuropeanSocialSurveyPeopleatriskofpoverty&socialexlu-sion;EUROSTATilc_peps01
Dischargeofpublicbudget
Expenditureonsocialprotection,Structureofsocialprotectionexpendi-ture.Expenditureoncarefortheel-derly,etc.EUROSTAT;spr_exp_sum
Equity WorldValuesSurveyEuropeanSocialSurvey
Legitimation
SIPRINCIPLES
SIEFFICIENCY(dilemma’s) Unclearwhatefficiencymeans(inrelationtoeconomicandpolitical)
GovernanceEffectiveness/Efficiency;RegionalInnovationMonitorSurvey,indicatorRIM_GOV_EFF
Internalaswellasexternalefficiency
GovernanceEffectiveness/Efficiency;RegionalInnovationMonitorSurvey,in-dicatorRIM_GOV_EFF
Shorttermvslongterm
GovernanceEffectiveness/Efficiency;RegionalInnovationMonitorSurvey,indicatorRIM_GOV_EFF
Contextualembeddedvs.de-contextualiseddif-fusion
Staticvsdynamicefficiency Autonomyvspublicfundingdependency
Competitionvscollabora-tion
46|SIMPACT–T5.1
SIGOVERNANCE(modes) Withorwithoutgovern-ment
Withorwithoutgovern-ment
Publicregulation
SIMPACT–T5.1|47
Table11. Macro-level(nationalandregional)IndicatorsetforSI,withEUdatasources
Tangible Intangible
Labour SIPOTENTIAL Numberofworkersinhumanhealthandsocialactivities(NACER2,Q)Available:Eurostattablelfsq_egan2
Voluntarywork:UnpaidworksocialwelfareserviceAvailable:EuropeanValuesSurveyVariableA081
SINEEDS Long-termunemploymentratesbysex,ageandcitizenshipAvailable:Eurostattablelfsq_urgan
Inactivepopulationbysex,ageandwillingnesstoworkAvailable:Eurostattablelfsq_igaww
Jobsatisfaction
Available:EuropeanValuesSurveyVariableC033
FinancialCapital
SIPOTENTIAL GDPatmarketpricesAvailable:WordBank,WDITables
Governmentexpenses–providinggoodsandservices(%ofGDP)Available:WordBank,WDITables
TotalexpenditureofcharitiesandfoundationsAvailable:DAFNEDonorsandFoun-dationsNetworkEurope
TotalpublicexpenditureonsocialbenefitsAvailable:Eurostattabletps00102
Innovativeenterprisesthatreceivepublicfundingasa%oftotalAvailable:Eurostattablehtec_cis6
StartingaBusiness
Available:WorldBank,DoingBusi-nessData
NumberofStart-ups:Businessde-mographicsmainvariablesAvailable:Eurostattabletin00170
SINEEDS Centralgovernmentdept,total(%ofGDP)Available:WordBank,WDITables
Enterprisedeathrates:Businessde-mographymainvariablesAvailable:Eurostattabletin00170
PeopleatriskofpovertyorsocialexclusionAvailable:Eurostattabletipslc10
Claimingstatebenefitswhichyouarenotentitledto
Available:EuropeanValuesSurveyVariableF114
HousingcostoverburdenratebyagegroupAvailable:Eurostattabletessi161
PublicCapital
SIPOTENTIAL InfrastructureInvestment
Available:OECDdoi:10.1787/b06ce3ad-en
Levelofinternetaccess–house-holdsAvailable:Eurostattabletin00134
48|SIMPACT–T5.1
Tangible Intangible
GovernmentExpense–providinggoodsandservices(%ofGDP)Available:Eurostattabletin00134
Modeoftransport–Typicallymostoftenuses
Available:Eurobarometer82.2(Oct2014)Variableqa1
SINEEDS QualityofGovernment
Available:EuropeanQualityofGov-ernmentIndex(EQI)
Internetsubscription–mainfactor
Available:Eurobarometer81.1(Jan2014)Variableqb7a
ModalsplitofpassengertransportAvailable:Eurostattabletran_hv_psmod
Modeoftransportreason:Noalter-native
Available:Eurobarometer82.2(Oct2014)Variableqa2.7
KnowledgeCapital
SIPOTENTIAL Totalpublicexpenditureoneduca-tionAvailable:Eurostattabletps00158
Employmentbysex,occupationandeducationalattainmentAvailable:Eurostattablelfsa_egised
LifelonglearningAvailable:Eurostattabletsdsc440
ResearchonSI(publications&pa-tents)Available:Patstat,ScopusandEUOpenAIRE
Youngpeople’ssocialorigin,educa-tionalattainmentlevelandlabouroutcomes
Available:Eurostattableedat_lfso_00t3
SINEEDS Earlyleaversfromeducationandtraining,agegroup18-24Available:Eurostattabletesem020
Improveknowledge/skills:last12months
Available:ESS7-2014,Variableatncrse
SocialCapital
SIPOTENTIAL Totalexpenditureonsocialprotec-tionbytype(%oftotalexpendi-ture)Available:Eurostattabletps00101
Feelconcernedabout:PeopleintheneighbourhoodAvailable:EuropeanValuesSurvey,VariableE154
Membershipofasocialwelfareser-vice,organisation,charity
Available:EuropeanValuesSurvey,VariableA064
Preparedtohelppeopleintheneighbourhood
Available:EuropeanValuesSurvey,VariableE164
SINEEDS QualityofGovernment
Available:EuropeanQualityofGov-ernmentIndex(EQI)
Trustincountry’sparliament
Available:ESS7-2014,Variabletrstpr1
Genderdifferencesintheat-risk-of-povertyrateAvailable:Eurostattableilc_pnp9
TrustinthelegalsystemAvailable:ESS7-2014,Variabletrstlgl
ImmigrationAvailable:Eurostattabletps00176
Trustinpeople
Available:ESS7-2014,Variableppltrst
Health SIPOTENTIAL Expenditureofprovidersofhealthcarebyfinancingagentsinhealthcare
Available:Eurostattablehlth_rs_prsrg
SIMPACT–T5.1|49
Tangible Intangible
HealthpersonnelbyNUTS2regions
Available:Eurostattablehlth_rs_prsrg
Subjectivegeneralhealth
Available:ESS6-2012,VariablehealthC7
SINEEDS Self-reportedunmetneedsformedicalexaminationbysex,age,detailedreasonsandincomequna-tileAvailable:Eurostattabletgs00064
Hamperedindailyactivitiesbyill-ness/disability/infirmity/mentalproblemAvailable:ESS7-2014,Variablehltphnap
SIMPACT–T5.1|50
Table12. IndicatorsontangibleormonetisableaspectsofSIinausetable,anindicativeinput-outputexerciseonSIenablersandSIbeneficiaries.
needsKnowledgeCapital
potentials
Longterm
unemploym
entratesby
sex,ageand
citizenship
Inactive
population
bysex,age
and
willingness
towork
Central
government
debt,total
(%ofGDP)
Enterprise
deathrate:
Business
demography
main
variables
Peopleat
riskof
povertyor
social
exclusion
Housing
cost
overburden
ratebyage
group
Government
Expense-
providing
goodsand
services(%
ofGDP)
Levelof
internet
access-
households
Modalsplit
of
passenger
transport
Earlyleavers
fromeducation
andtraining,
agegroup18-24
Qualityof
Government
Gender
differences
intheat-risk-
of-poverty
rate
Immigration
Self-
reported
unmet
needsfor
medical
examinatio
nbyincome
quintile
Available
bedsin
hospitalsby
NUTS2
regions
Labour
Nrofworkersin
humanhealth
andsocial
activities(NACE
R2,Q)
v v v v v v
GDPatmarket
pricesv v
Totalpublic
expenditureon
socialbenefits
v v v v v v v v
Innovative
enterprisesthat
receivepublic
fundingasa%of
total
v v v v v v v v
NumberofStart-
Ups:Business
demography
mainvariables
v v v v v v v v
Infra-structure
Investmentv v v v v
Qualityof
Governmentv v v v v v v v v v v v v
Government
Expense-
providinggoods
andservices(%
ofGDP)
v v v v v v v v v v v v
Health
SIBeneficiaries
PublicCapital
PublicCapital SocialCapitalLabour FinancialCapital
FinancialCapital
UsetableofTangibleSI
SIEnablers
SIMPACT–T5.1|51
Totalpublicexpenditureoneducation
v v
Employmentby
educationalattainment
level
v v v v v v
ResearchonSocial
Innovation(PublicationsandPatents)
v v v
Totalexpenditureonsocial
protectionby
v v v v v v v v v
Membershipofasocialwelfareservice,
organisation,charity
v v v v v v v v
Expenditureofprovidersofhealthcarebyfinancingagentsinhealthcare
v v v v v
Healthpersonnelby
NUTS2regions
v v v v v v v v v
SocialCapital
Health
Know-ledgeCapital
SIEnablers
52|SIMPACT–T5.1
Themeticfield(Problemaddressed) Employment(1)Migration(2)Demographics(3)Gender(4)Education(5)PovertyTargetgroup Unemployed(1)youngunemployed(2)migrants(3)children(4)elderly(5)other(6)CountryScopeGeographical local(1),Regional(2),National(3),Europa(4)global(5)NameofRegion(NUTS2code)Developmentstage Ideation(1)Prototyping(2)Implemented(3)Scaled(4)Discarded(5)Prospectsforexpansion veryhigh high moderate low verylowWhattypeoforganisationistheSocialInnovator? Association(1)SocialEnterprise(2),Foundation(3),NGO(4),Other(5)WhattypeofSocialInnovationisit?NewProduct/service no(1)yes(2)Newmarket/ortargetgroup no(1)yes(2)Organisationalinnovation no(1)yes(2)Newmethod,process-innovation no(1)yes(2)Newinputs(expertise,ICT,design-skills,material,etc.) no(1)yes(2)HowwouldyouratetheSocialInnovator'sinternalknowledgebaseonthethemeandtargetgroup veryhigh(5)high moderate low verylow(1)HowwouldyouratetheSI'suseofexternalknowledgeonthethemeandtargetgroup? veryhigh high moderate low verylowHowwouldyouratethebusinessknowledge,andmanagementcapabilitiesoftheSocialInnovator? veryhigh high moderate low verylowAbouthowmanyactorsareinvolvedintheinnercoreoftheSocialInnovationAbouthowmanyorganisationscollaborateaspartners,promotors,andsupportersofthesocialinnovation?Howwouldyouratethediversityoftheactorsinvolved? veryhigh high moderate low verylowFunding&financeRatetheextenttowhichthesocialinnovationgeneratesrevenues/sales? veryhigh high moderate low verylow notatallWhatkindoforganisationisthemainFunder? Individual(1)non-governmental&thirdsectororganisation(2),informalorganisation(3),privatefirm(banketc.)(4),localgovernment(5),stategovernment(6)otherpublicsector(7)Funder2 Nosecondfunder(0)Individual(1)non-governmental&thirdsectororganisation(2),informalorganisation(3),privatefirm(banketc.)(4),localgovernment(5),stategovernment(6)otherpublicsector(7)Funder3 Nothirdtypeoffunding(0)Individual(1)non-governmental&thirdsectororganisation(2),informalorganisation(3),privatefirm(banketc.)(4),localgovernment(5),stategovernment(6)otherpublicsector(7)PleaseratetheImportanceofobjectivesCorrectingamarketfailureinservingun-metneedsoftargetgroup veryhigh high moderate low verylow notatallComplementingpublicpolicyinservingun-metneeds veryhigh high moderate low verylow notatallBusinessopportunities(increaserevenues/profit) veryhigh high moderate low verylow notatallIncreasetheeconomicvalueofcapabilitiesofthetargetgroup(e.g.Employability,work-skills) veryhigh high moderate low verylow notatallIncreasethepersonal&socialvalue/capabilitiesofthetargetgroup(e.g.Empowerment,health,life-skills,self-confidence)Increasethepublicvalue/capabilitiesofthetargetgroup(socialcohesion,inclusion,lobbying,legitimation)veryhigh high moderate low verylow notatallRatetheimportanceofthefollowingresources(andactivities)asinputsKnowledge(e.g.fromexperts,knowledgeinstitutes,students veryhigh high moderate low verylow notatallLabour veryhigh high moderate low verylow notatallCapital/funding veryhigh high moderate low verylow notatallSocialcapital(engagement,volunteering) veryhigh high moderate low verylow notatallRelationalcapital,resources,networking veryhigh high moderate low verylow notatallTraining,education veryhigh high moderate low verylow notatallPoliticalsupport veryhigh high moderate low verylow notatall
SIMPACT–T5.1|53
Table13. MainsurveyquestionsaddressedbytheSIcasesofSIMPACT
ratethelikelyachievedoutcomes/outputsoftheSIIncreasedlifeskillsofthemarginalised veryhigh high moderatelow verylow noneIncreasedworkingskillsofthemarginalised veryhigh high moderatelow verylow noneIncreasedphysicalcapabilitiesofthemarginalised veryhigh high moderatelow verylow noneIncreasedothercapabilitiesofthemarginalised veryhigh high moderatelow verylow noneImprovednetworksofthemarginalised veryhigh high moderatelow verylow noneImprovedself-confidenceofthemarginalised veryhigh high moderatelow verylow noneEmploymentofthemarginalised veryhigh high moderatelow verylow noneImprovedincome/lesscostsforthemarginalised veryhigh high moderatelow verylow noneIncreasedcapabilitiesoftheSocialInnovator veryhigh high moderatelow verylow noneIncreasedmanagementcapabilities veryhigh high moderatelow verylow noneIncreasedmarketingcapabilities veryhigh high moderatelow verylow noneImprovednetworksoftheSocialInnovator veryhigh high moderatelow verylow noneImprovedself-confidenceoftheSI veryhigh high moderatelow verylow noneEmploymentgrowthattheSI veryhigh high moderatelow verylow noneImprovedrevenues/lesscostsfortheSI veryhigh high moderatelow verylow noneReducedpublicbudgetcosts veryhigh high moderatelow verylow noneOthercomplementstopublicpolicy veryhigh high moderatelow verylow noneOtherbenefitsforprivatepartners veryhigh high moderatelow verylow noneOthercivicoutcomes/benefits veryhigh high moderatelow verylow noneHowwouldyouratetheimportanceofobstacles?Financial veryhigh high moderatelow verylow noneOrganisational/logistical veryhigh high moderatelow verylow noneLegal veryhigh high moderatelow verylow nonePolitical veryhigh high moderatelow verylow noneSocietal/cultural veryhigh high moderatelow verylow noneMarketshare(competition) veryhigh high moderatelow verylow noneTechnological veryhigh high moderatelow verylow noneHowwouldyouratethelong-termoutlookoftheSIonascaleof10
Howdoyouratetheextenttowhichthefollowingwp3findingsapplytothiscase?
54|SIMPACT–T5.1
Table14. Thecombinedsetsofmicro-andmacro-levelofindicatorsforSI,forintangibleandtangibleaspects
Micro-levelindicatorsforSIcases
Macro-levelSIindicatorsforcountries/regions
Intangi-ble
TypeofSI(SI)SI’sinternalknowledgebaseonthethemeandtargetgroupSI’sbusinessknowledge,andmanagementcapabilitiesSI'suseofexternalknowledgeonthethemeAimtocomplementpublicpolicyinservingun-metneedsAimtoincreasethepersonal&socialvalue/capabilitiesofthetargetgroup(e.g.Empowerment,health,life-skills,self-confidence)Aimtoincreasethepublicvalue/capabilitiesofthetargetgroup(socialcohesion, inclusion, lobbying,legitimation)NumberofactorsinvolvedDiversityofactorsinvolvedKnowledge(e.g.fromexperts,knowledgeinstitutes,students)asinputSocialcapitalasinput(volunteers)Relationalcapitalasresourceinput(networkTraining,educationasresourceinputPoliticalsupportasinputICTasinputIncreasedlifeskillsofmarginalised:outputIncreasedworkingskillsofthemarginalisedIncreasedphysicalcapabilitiesmrgn.Increasedothercapabilitiesmrgn.Improvednetworksofthemrgn.Improvedself-confidencemrgn.IncreasedmanagementcapabilitiesofSocialInnovator(asoutput)IncreasedmarketingcapabilitiesofSIIncreasedothercapabilitiesofSIImprovednetworksoftheSocialinnovatorImprovedself-confidenceoftheSIOthercomplementstopublicpolicy
QualityofGovernmentClaimingstatebenefitswhichyouarenotentitledtoYoungpeople'ssocialorigin,educationalattainmentlevelandlabouroutcomes;ImmigrationResearchonSI(publications)Voluntarywork:Unpaidworksocialwelfareservice;PreparedtohelppeopleintheneighbourhoodFeelconcernedabout:Peopleintheneighbourhood;TrustinpeopleLifelonglearningLevelofinternetaccess–households/InternetSubscriptionInactivepopulationbysex,ageandwillingnesstoworkImproveknowledge/skills:last12monthsSubjectivegeneralhealth;Hamperedindailyactivitiesbyillness/dis-ability/infirmity/mentalproblem
SIMPACT–T5.1|55
Micro-levelindicatorsforSIcases
Macro-levelSIindicatorsforcountries/regions
OtherbenefitsforprivatepartnersOthercivicoutcomes/benefitsLegalobstacletoinnovationPoliticalobstacleSocietal/culturalobstacleMarketshare(competition)obstacleOrganisational/logisticalTechnologicalobstacle
Membershipofasocialwelfareservice,organisation,charityTrustinthelegalsystemTrustincountry'sparliament;QualityofGovernmentStartingaBusiness(WorldBank,DoingBusinessData)Modeoftransportreason:Noalternative
Tangible SIgeneratesrevenues/sales?MaintypeofFunderofSI?Aimtocorrectamarketfailureinservingun-metneedsoftargetgroupAimforBusinessopportunities(increaserevenues/profit)Aimtoincreasetheeconomicvalueofcapabilitiesofthetargetgroup(e.g.Employability,work-skills)LabourinputCapital/fundinginputEmploymentofthemarginalisedasoutputImprovedincome/lesscostsforthemarginalisedasoutputEmploymentgrowthattheSIasoutput
(Sizeofthirdsector,%ofGDP)Innovativeenterprisesthatreceivepublicfundingasa%oftotalTotalpublicexpenditureonsocialbenefits;ExpenditureofprovidersofhealthcarebyfinancingagentsinhealthcareGDPatmarketpricesTotalpublicexpenditureoneducationNr of workers in human health and social activities (NACE R2, Q);HealthpersonnelbyNUTS2;(Sizeofthirdsector,employees)Totalexpenditureonsocialprotectionbytype,%oftotalexpenditureTotalexpenditureofcharities&foundationsLong-termunemployment;Employmentbysex,occupationandedu-cationalattainment.PeopleatriskofpovertyorsocialexclusionHousingcostoverburdenratebyagegroup(growthofthirdsector,employment)(Growthofthirdsector,%ofGDP)
56|SIMPACT–T5.1
Micro-levelindicatorsforSIcases
Macro-levelSIindicatorsforcountries/regions
Improvedrevenues/lesscostsfortheSIasoutputReducedpublicbudgetcostsasoutputFinancialobstacletoinnovationLong-termoutlook
CentralgovernmentdebtNumberofStart-Ups:BusinessdemographymainvariablesEnterprisedeathrate:Businessdemographymainvariables
SIMPACT–T5.1|57
5 EVALUATIONANDIMPACTASSESSMENTOFSOCIALINNOVATION
5.1 SIImpactMeasurementTools&Methods
Althoughitismostlyfocusedontheinvestmentframeworkforaddressingsocial
needs,andnotspecificallyoninnovation,theaboveFigure11doesgiveusaclear
ideawhichSIactorscouldprovideuswithdataandindicatorsthatcouldplayan
importantrole inourmeasurement framework.Wecanseesupplyanddemand
sideactorsaswellastheservices/productsforwhichinvestmentisnecessaryintermsofsocialneedse.g. societalproblems.We find that for thesocialneedsor
societalproblemsenvironmentthecharacteristicsofthebeneficiaries,thetarget
areas(ofneedsandproblems)andtheaccesstoproducts/marketsandservicesare
ofimportance.Theactorsreactingtotheseneedsandproblemsareonthedemand
sideandarecharacterisedbytheirintenttodeliversolutionsbutalsobyajustifi-
cationoftheuseofthesesolutionsthroughmonitoringandmeasuringtheimpact
oftheirinnovations.Onthesupplysidethemaincharacteristicistheexpectation
thatthedemandsidegoalsareachievedandthatthereissomekindofsocialreturn
(sharedvalue).Inaddition,theinvestors’intentisanimportantcharacteristichere.
The intermediariesare inessencenomorethantransactionalbodies translating
thedemandsideneedsintorequestsforthesupplysidewhileputtingtheseintoa
regulatoryframework.Thisbringsustothesocial-economicsystem,whichisthe
enablingenvironmentdictatingthewaythesetransactionsareconductedaswell
asthesocialandculturalappropriatenessofthedemandsandinnovationse.g.so-
lutions.
Aswediscoveredinsection3.3.3,thekeytomeasuringtheimpactofSIistoidentify
theusevalueofSIinterventions.However,asWood&Leighton(2010:20)point
out,“socialvalue’referstowidernon-financialimpactsofprogrammes,organisa-
tionsand interventions, including thewellbeingof individualsandcommunities,
socialcapitalandtheenvironment.Thesearetypicallydescribedas‘soft’outcomes,
mainlybecausetheyaredifficulttoquantifyandmeasure.”
ThoughmeasuringthesocialandeconomicimpactofSIshasbecomeanimportant
task(see,forinstance,Pol&Ville2008)thereisnocommonlyacceptedmethodor
standard to perform this task efficiently.Wood&Leighton (2010: 20-21) name
about30differentmodelsusedtomeasuresocialvaluewithintheUKandtheUSA,
therebyobservinga“fragmented, ‘bottom-up’andsomewhatad-hocapproachto
SIsupplyandde-mandactors
MeasuringSIimpact
58|SIMPACT–T5.1
measuringsocialvalue”.Theyrefertoanon-exhaustiveoverviewofqualityandim-
pactmeasurementtoolsprovidedbyAngier-Griffin(2009).Theypointoutthatdif-
ferenttoolshavebeendevelopedtosupportdifferentapproachestomeasuringso-
cial value and that these different tools reflect the differentmethodological ap-
proacheschosen(SeeFigure14.).Theauthorsdistinguish fourdifferentkeyap-
proachestowardssocialvalue/impactmeasurement:
1. “a‘wholeorganisation’approachora‘projectbased’approach.Thewholeorganisationapproachseekstoaccountforsocialvalueacrossthewholeofanenterpriseandismostlycommonlybaseduponastakeholderapproach.Aprojectbasedapproach is concernedwithappraising the socialvalueofaparticularprojectoractivity(usuallyinordertoaccountforthatsocialvaluetoafunderorcommissioner)
2. useof‘softoutcomes’oruseof‘financialproxies’.Sometoolsseektodemon-stratesocialvaluebydemonstratingtheeconomicbenefitofparticularso-cial, environmental orwell-being outcomes. Other tools use social sciencetechniquestothemeasureandreportthesocialoutcomesusing‘softindica-tors’ (e.g.attitudinal responses,behavioural indicators,opinionsof serviceusers)
3. ‘selfreported’or‘independentlyverified’.Independentverificationcanbeex-pensive.Thusinsomecasesinmaybebothappropriateandmostcost-effec-tive tomeasureandreportsocialvaluebaseduponauditeddata. Inothercontexts,theauthorityofexternalvalidationagainstagreedstandardsmaybeanessentialpartoftheprocess.
4. afourthdynamicisscale.Toolsdesignedforusewithinalargemultinational(e.g.GlobalReportingInitiative,AA1000)willnotbeappropriateforusbysmalleremergingsocialenterprises.
Concluding,Angier-Griffinmaps thesedifferent toolsandmethodsalong twodi-
mensions(seeFigure14.):“Thehorizontalaxisrepresentsthelevelofcomplexity
andresourcesrequiredtousethetool.Theverticalaxisrepresentsthereported
results in termsof economic impact (what is the benefit of social value created
measuredineconomicterms)versussocialimpact(whatisthebenefitsocialvalue
createdmeasuredagainstindicatorsofwell-beingandqualityoflife)(Angier-Grif-
fin.com2009).”
5.1.1 SocialAccounting&Auditing(SAA)
Socialaccountingandauditing(SAA)isanearlierattemptby(commercial)organi-
sations,introducingCSRprinciplesandmeasures,andwantingtoprovidemetrics
forthesemeasureswiththeearmarkofbeingabletojustifythesemeasurestotheir
stakeholderse.g.shareholders.SAAisusedforsocial impactreportingdeparting
Levelofcomplexity&necessaryre-
sources
SIMPACT–T5.1|59
fromawelfareeconomicsinspiredpremisethatanalternativesocialgood/innova-
tioncanbe“priced”atwhatabeneficiarywouldbewillingtopayforit,allowing
inputsandoutputstobecomparedinatraditionalway.However,asSItakesplace
inaspaceinwhichnormalmarketshavefailedtoperform,therearenocomparable
products(Nicholls,2009)andassuchitisextremelydifficulttomonetisemanyof
theSIsimplementedandinnovativeservicesrendered.
Nevertheless,itisimportanttotakenoteofsomeoftheSAAframeworks/systems
developed.Forinstance,theIRISsystem10,developedandmaintainedbytheGlobal
Impact Investment Network (GIIN) has a sizeable set ofmetrics onwhich they
gatherdataandpartsofwhichareofinterest.Furthermore,theseSAAprinciples
have also been applied to the setting of (philanthropic) non-profit foundations,
bringingwiththemausefulcrossoverofmonetisationto“valuation”oftheearlier
mention“Usevalue”orsharedvalue.InthebelowFigure12wecanseethatnext
tocost-effectivenessandcost-efficiencyexercises,practitionerandbeneficiaryin-
sightsarebroughtforwardasoneofthe8sourcesofimpactevidence.
Figure12. Philanthropicevidencechart
Wecanfurthermoreseethatcasestudiesonthefieldexperienceside,stakeholder
inputontheinformedopinion,andtrailsandexperimentalstudiesontheacademic
researchside,couldserveasviableinformationsources.Itisapparentthatpurely
quantitativedataoreasilyquantifiabledataandinformationisnotreallyobvious
looking at the suggested sources.Much like the Community Innovation Surveys
(CIS)anditsnationalspin-offs(alsointheOECDcontext)theinclusionofqualita-
tivedataisnotjustunavoidablebutanecessity(alsoseethebelowsectionSROI).
10See:https://iris.thegiin.org/
Sourcesofinfor-mation
60|SIMPACT–T5.1
UnliketheCIS,adatacollectioneffortforSImetricswillalsoneedtolookfordata
fromunusualrespondents,shiftingfrom,beneficiaries(casestudies)tofirms(CIS)
andpublicsector(NESTA)totheThirdSector.
5.1.2 SocialReturnonInvestments(SROI)
Anothermeasurementapproachthatisoftenreferredtobygovernments(Wood&
Leighton2010:13-14)istheSocialReturnonInvestments(SROI)approach,asin
particulardevelopedbytheSROINetwork(Nichollsetal.2012).“SROImeasures
changeinwaysthatarerelevanttothepeopleororganisationsthatexperienceor
contributetoit.Ittellsthestoryofhowchangeisbeingcreatedbymeasuringsocial,
environmental and economic outcomes and usesmonetary values to represent
them.Thisenablesaratioofbenefitstocoststobecalculated(Nichollsetal.2012:
8).”SROIappliessevenprinciplesandisperformedoversixstages.TheSROIprin-
ciplesare(Nichollsetal.2012:9):
• Involvestakeholders.
• Understandwhatchanges.
• Valuethethingsthatmatter.
• Onlyincludewhatismaterial.
• Donotover-claim.
• Betransparent.
• Verifytheresult.
SocialReturnonInvestmentreportingdetails6stages,whichare(Nichollsetal.
2012:9f.):
• Establishingscopeandidentifyingkeystakeholders.ItisimportanttohaveclearboundariesaboutwhatyourSROIanalysiswillcover,whowillbe in-volvedintheprocessandhow.
• Mappingoutcomes.Throughengagingwithyourstakeholdersyouwillde-velopanimpactmap,ortheoryofchange,whichshowstherelationshipbe-tweeninputs,outputsandoutcomes.
• Evidencing outcomes and giving thema value. This stage involves findingdatatoshowwhetheroutcomeshavehappenedandthenvaluingthem.
• Establishingimpact.Havingcollectedevidenceonoutcomesandmonetisedthem, thoseaspectsofchangethatwouldhavehappenedanywayorarearesultofotherfactorsareeliminatedfromconsideration.
SIMPACT–T5.1|61
• CalculatingtheSROI.Thisstageinvolvesaddingupallthebenefits,subtract-inganynegativesandcomparing the result to the investment.This isalsowherethesensitivityoftheresultscanbetested.
• Reporting,usingandembedding.Easilyforgotten,thisvitallaststepinvolvessharingfindingswithstakeholdersandrespondingtothem,embeddinggoodoutcomesprocessesandverificationofthereport.
5.1.3 OtherSocialImpactMeasurementApproaches
AlthoughtheSROIapproachlargelycorrespondstothedemandsoftheGECESsub-
group(2013)withrespecttoeffectiveimpactmeasurement.This,eventhoughthe
GECESsub-groupalsoclaimsthataquantificationofimpact(asacriticalpointof
SROI is thestrictmonetisationofoutcomes)missesthespecificsocialobjectives
(theusevalue!)ofmanySIsandthus,cannotbeappliedtoallorganisations(Wood
&Leighton2010:14).Otherapproachesthereforepointoutthatsocialimpactas-
sessmentshouldnotonlybelimitedtoquantitativedatabutalsotoqualitativeap-
proachesanddata(see,forinstance,vonJacobietal.2015:13-15).Astrongargu-
mentinthisregardisthatmanyaspectsofSIandtheirobjectivescannotbeade-
quatelyrepresentedinquantitativeterms.Examplesforthisarethedegreeofmar-
ginalisationortheresources(e.g.agency/power,socialties)ofindividualsthatare
targetedbySI.Inaddition,asvonJacobietal.(2015:17-19)pointout,anysocial
impactmeasurementmustbeclearwithregardstotheunitofanalysis.Ameasure-
mentmaybeperformedonthemicro-levelandthuscapture(marginalised)indi-
viduals,familiesorenterprisesandotherorganisations,onthemeso-level,captur-
ing groups, neighbourhoods, ormunicipalities, provinces and regions, or on the
macro-levelandcaptureawholecountry.Eachlevelrequiresspecificindicators.
Equallyimportantforansweringthequestion“whattomeasure”isthedimension
inwhichthescrutinisedsubjectshallbemeasured.SIaimsatmarginalisedpeople
butmarginalisationcanbeconceptualisedandcapturedindifferentways.Forin-
stance,itcanfocusoneconomicmarginalisationandmeasurepoverty,oritcanaim
atwell-beingand/orsocialandpoliticalparticipationandmeasuretheperceived
well-beingofindividualsindifferentcontextsortheirpoliticalandsocialactivities.
Given thatmarginalisation is a multi-dimensional problem there are numerous
waystoapproachandmeasureit,andmanymeasurementstrytocapturethemulti-
dimensionalityofmarginalisationbycombiningdifferentapproachesandmethods.
VonJacobietal.(2015:19-20)suggestcapturingmarginalisationinsixareasoflife
inwhich lack of poweror empoweringprocessesplay a vital role: nature, arte-
facts/technology,culture,economy,military/personalsecurityandpolitics.
Finally,itmustbenotedthatbecausetheterm“SI”itselfisnotclearlydefinedand
assuchallows forvaryingconcepts that in turnaffectmeasurementapproaches
Whattomeasure?
62|SIMPACT–T5.1
andresults.Forinstance,aconceptofSIthatputsanindividual’sorsmallgroup’s
responsetoasocialneedatthecore(e.g.Mumford2002)wouldfocusonthatindi-
vidualorgroupincontextwiththeidentifiedsocialneed/targetgroup.Incontrast,
aconceptofSIfocusingonnetworks(e.g.Young2011,LeBer&Branzei2010,Per-
rinietal.2010)wouldemphasisethenetworkdynamicsanddrawnooratleasta
lessstrictlinebetweeninnovatorsandtargetgroups.
This range of issues provides a strong barrier towards an efficient and realistic
measurementofusevalueandtheimpactofSI.Therequirementsfrommeasure-
ments inthisregardarehigh.For instance, theGECESsub-group(2013:18)de-
mandsthateffectivesocialimpactmeasurementmustbe:
• relevant:relatedto,andarisefromtheoutcomesitismeasuring
• helpful:inmeetingtheneedsofstakeholders’,bothinternalandexternal
• simple:bothinhowthemeasurementismade,andinhowitispresented
• natural:arisingfromthenormalflowofactivitytooutcome
• certain:bothinhowitisderived,andinhowitispresented
• understoodandaccepted:byallrelevantstakeholders
• transparentandwell-explained:sothatthemethodbywhichthemeasure-
mentismade,andhowthatrelatestotheservicesandoutcomesconcerned
areclearlyfoundedonevidence:sothatitcanbetested,validated,andfrom
thegroundsforcontinuousimprovement.
WhileapproacheslikeSROIseemtoformallymeettheserequirementsitisobvious
thattheconceptualanddataproblemsoutlinedabovemakeitdifficulttoproduce
validresultswithregardtotheserequirements.Inaddition,thefactthatsocialim-
pactmeasurementusuallycoversavarietyofstakeholderswithdiverginginterests
even complicates the measurement. For instance, the recommendations of the
GECESsub-group(2013:1)requirefromthemeasurementofsocialimpacttobal-
ance
• theneedsofsocialenterprises,investors,fundmanagersandotherstake-
holders
• comparabilityinreportingandmonitoring.
• costsofmeasurementagainstitsbenefits.
• thediversityofneed,servicesprovided,geographyanddemography,be-
tweenStateandvoluntaryandcommunitysector (“VCS”)provision,and
StateandotherfundingacrosstheMemberStates.
• Betweenaclearandcertainapproach,butonewhichcancopewithchange
andimprovement
Efficient&realisticmeasurement
SIMPACT–T5.1|63
Becker(2001:311)definessocialimpactassessmentas:“theprocessofidentifyingthefutureconsequencesofacurrentorproposedactionwhicharerelatedtoindivid-uals,organizationsandsocialmacro-systems”.Socialimpactassessmentsweretyp-icallycommissionedbygovernmentstoassesstheconsequencesofamajorpublic
project,nexttoassessmentofthesocialconsequencesalsoeconomicimpacts,en-
vironmentalimpactsandfiscal-impactscouldbepartoftheassessment.Bynow,
social impact assessments areobligatory formost governments in theEUwhen
they innovate their laws, institutions orpolicies.According to theVanclay et al.
(2015:.2)socialimpactsarechangestooneormoreofthefollowing:people’sway
oflife;theirculture;community;politicalsystems;environment;theirhealthand
wellbeing;personalandpropertyrights;and/ortheirfearsandaspirations.Later,
alsomanyfirmsandnon-profitorganisationsmadeuseofsocialimpactassessment
whentheyformulatenewpolicy,seekfundingfornewproposals,orreportonpast
activitiesinannualreports.Sinceweprobablystillmostlyhavethelargescale,re-
sourceintensivesocialimpactassessmentsinmindthatarecommissionedbygov-
ernmentsforlargeprojects,mostSIMPACTcasestudiesprobablydidn’tspotthe
many,small-scale,light,tacit,ad-hocsocialimpactassessmentactivitiesconcerning
thechangesinthelivesofbeneficiariesoftheSI.
5.2 UsageofFormalEvaluation&AssessmentToolsforMeas-uringEconomic&SocialImpact
AccordingtotheanalysisofTerstriepetal.(2015)theimpactofSIishardlymeas-
uredorevaluated.Forinstance,Terstriepetal.(2015)reportconcerningthecase
studyKONNEKTid(box3.4-42;p.113)thatit“doesn’tmeasureitssocialimpactin
anywayalthoughinternalcommunicationregardingperformanceandresultsare
discussed,butislimitedtoconcernedstakeholders”.Thisstatementexplainsthat
thesocialinnovatorevaluatestheperformanceandresultsinaninformal,qualita-
tiveway,byexchangingtacitknowledgewithstakeholders.TheSIdidn’tusefor-
mal,quantitativetoolstomeasureresultsintermsofstandardisedindicatorsfor
impact.Vielfalter(Terstriepetal.2015;box3.4-18)hasnotissuedanyformalcom-
municationontheimpactoftheirprogramme,butininternalcommunicationsit
has.ThemainreasonwhytheSIcasestudiesdidnotrecordmanyevaluationsand
impactassessmentscouldbetheconfusionofwhatitactuallyis,sincethereisno
agreementonthedefinitionsandthemethods:
• doonlyformalevaluationsandcodifiedimpactscount?
• doesonlyoutputintermsofexchangevaluecount?
• Istacitknowledgeandlearninglessvaluable?
Impactmeasurement–anexception
64|SIMPACT–T5.1
TherearemanyreasonswhySocialinnovatorsmaynotuseformaltoolsforevalu-
ationandwhyitismoredifficult,anddifferentforSI.Ashasbeenconfirmedinour
casesstudiesJepson(2005)andNicholls(2008)forinstancerefertothe“trustor
legitimacysurplus”whichisgrantedtomanynon-profitorganisationsbecauseof
theircharitablestatusorreputation,whichmeansthatresourcesarenotallocated
based onmeasured performance. Compared to impact assessment of for profit
businessinnovationsitismoredifficultforSItofindoutwhatcauseswhat,since
therearemoredifferentinputsinvolved,fromvariousactors(funders,beneficiar-
ies,donors,implementers,users,partners)withvariousobjectives(oraimedout-
comes),andthereforealsolikelytohaveabroaderrangeofoutcomesandimpacts.
Inthepharmaceuticalsectoritisobligatorytoassesstheimpactfromnewmedi-
cinesonhealth.Innovationsintheautomotiveindustryhavetobeassessedontheir
impactonpollutionandsafety.Thekindsofimpactthatfirmsareobligedtoreport
ondiffersbysectorandpoliticalcontext.Terstriepetal.(2015)statesthatsome
for-profitcompaniesdomoreonsocialimpactassessmentthatSIs.Inordertocon-
vincemarketsthattheyarenotirresponsibletheyvoluntaryshowsomeindications
ofpositivesocialconsequencesoftheiractivities.
Insomefieldsself-reportingisinstitutionalised,whenindustriesareforinstance
requestedtorecordtheuseofchildlabourforoff-shoredproduction.Mostcommon
kindofevaluationsofbusinessinnovationsisperhapscustomersatisfaction,but
this information ismostlykeptprivateoronlypositive, formarketingpurposes.
CustomermarketsarehoweverevaluatedbyforinstancetheEC.Theresultsofthe
10thEUconsumermarketscoreboardforinstanceshowsthatamongtheworstper-
formingsectorsare:bankingandtelecoms(seealsoFigure13).
Figure13. TheEUconsumermarketscoreboard(EU,2015c)
Wearenotawareofevaluationsconductedbybanksortelecomcompaniesonthe
socialandoreconomicimpactfromthesebadperforminginnovativemortgagesor
Our movesOur findings
New EU legislation on mortgages, payment accounts and investment products
Connected Continent proposal
Banking services: poor scores on all components
Telecoms: high number of problems & complaints
Energy: limited choice of providers,comparability of offers & switching
Second-hand cars & vehicle fuels: consistently at the bottom
Promoting transparency in energy bills, prices and offers.
In-depth EU studies to identify causes and remedies
Dootherkindsofin-novatorsmoreoften
evaluateimpact?
SIMPACT–T5.1|65
telecomservices(althoughtheymightcontributetohomelessnessandyoungsters
withhigh-debts).
So,somefirms,inthecontextofcorporateresponsibilitymayvoluntarilyconduct
andreportonsocialandeconomicimpactassessment,butnotall.However,forSI
wecouldevenclaimthattheyallreportonsocialandoreconomicimpactinone
wayoranother,buttheformandthemethodsused,areverybasic,light,qualitative,
low-cost,lessresource-intensive.E.g.:basedonpersonaltestimonialsfrombenefi-
ciariesonaFacebookpagewhichemphasisethesocialaspects,insteadofresource-
intensivetoolswithafocusoneconomicindicatorssuchasSocialReturnonInvest-
ment,orcost-benefitanalysis(Figure14.).The lattertoolsareactuallybasedon
methodstomonetise(estimatingtheconcerningexchangevalue)ofallfactorsand
indicators(social-indicators,environmental-indicators,health-indicators,etc.).Af-
termonetisation,thereareonlyeconomicindicators,whichallowforcalculationof
anestimatedsocialreturnoninvestmentinEuro’s.Foradescriptionofthetools
seesection5.3.
Figure14. Mappingofimpacttools
Source:AdaptedfromWood&Leighton(2010)
AnotherreasonwhysuchmoreformalandresourceintensivemethodsofSIimpact
evaluations are rare, is that it fits their mode of innovation: the scarcity of re-
sources,theirmissionorientedmodeofinnovation,andtheiraversiontobureau-
cracy,standardisationandforms.Impactevaluationsarecostly,soincasethefun-
dersdonotdedicateaseparatebudgetforit,ordemanditforgettingsubsidiesor
grants, social innovators may consider it a waste of resources, resources they
wouldratherspendonsupportingadditionalpeopleinneed.Socialinnovatorsor
ECON
OMIC
IND
ICAT
ORS
SOCI
AL IN
DIC
ATOR
S
ENTRY!LEVEL TOOL/Less resource intensive
COMPREHENSIVE TOOL/More resource intensive
BalancedScorecard
LogicalFramework
SocialFirms
Dashboard
SocialAppraisal
Toolkit
DTA« tell your story »
Quality of life/WellbeingIndicators
Social AuditNetwork
Framework
Social Returnon InvestmentLM3
AAA1000
GlobalReport
Initiative
MisfitbetweenSI&evaluationmethods
66|SIMPACT–T5.1
partnersmaynotseetheneedformeasuringandevaluatingimpact.Theymight
object to the ‘bureaucratic paperwork’, and mistrust the objective. Evaluations
amongbeneficiariesmayforinstancebeconsideredbyvolunteersorotherpartic-
ipantsassignsoflackoftrust.ThiswasforinstancethecaseinVoorleesExpress
(AppendixtextboxI)whereoriginallytheyaskedthechildrentogivethevolunteers
agradeaftereachsession.Butthechildrenactuallydidnotliketodothis,sothey
hadchosenanother,lessjudgingform,atanothermomentintime.Formalquanti-
tativeevaluationscanalsoformanadditionalpushfor‘hyper-exploitation’andget-
tingstuckinamereoutputorientedmodeofinnovation.
5.3 Whyevaluate&assessImpact?
Measurement,evaluationandimpactassessmentshouldbeseenfromalearning
pointofview.Tolearnfromthepast,andtoincorporatelessonsinplansforthe
future.Tolearnfromyourownexperiences,butalsoofthoseofothers.Manyofthe
informalwaysof learningandevaluatingarenot lessuseful,but therearesome
advantagesincodifiedformsandmorestandardisedmodesofevaluationandim-
pactassessment.Agreeingthatlearningistheoverarchingobjective,theEUGuid-
ancedocumentonMonitoringandEvaluation(2014),subsequentlydistinguishes
twopurposesofevaluationsorimpactassessments:supporting(strategicandop-
erational)management and assessingwhether the desired effect has been pro-
duced.CounterfactualimpactevaluationsfocusonthislatterpurposebyansweringthequestionDoesitwork?SincenotallchangescanbeattributedtotheSI,impact
referstothechangethatcanbecrediblyattributedtoaSI(EC,2014,p.6).Thequan-
titativemethodsusedaredevelopedinstatisticsandmedicalresearch,e.g.‘treated’
anda‘non-treated’controlgrouparecomparedtomakeitlikelythatthedifference
canbeattributedtothe‘treatment’orSIinourcase.Theory-basedimpactevalua-tionsservetosupporttheSImanagementbyansweringthequestion:whyandhowdoestheSIwork?Thetheoryofchangeiscentralinthismorequalitativeimpact
assessmentapproach.Thequestionwhycertainactionsproduceeffects, and for
whom,andunderwhichconditions,intentionallyorun-intentionallyisveryuseful
forthesocialinnovatorandforallthoseinvolvedintheimplementation,moreover
costsintermsofresources,timeandcompetencesareless,andintimeevaluation
practicescanevolvetowards,andcomplementedwith,morecodified,formaland
resource intensive forms of impact assessments, possibly involving partners in
theirecosystemsintheevaluation(Table15).
Evaluationsatthelevelofeco-systemsprovideopportunitiesforlearningamong
actorsinrelatedfields,butalsotosharecosts.InthecaseofMothersofRotterdam
(seeAppendixTextbox I) theuniversity haddeveloped a large international re-
searchproposalinwhichthesocio-medicalimpactsofcombinedmedicalandsocial
care(asitisdoneintheSIofMothersofRotterdam)wouldbeassessedatsystems
Learningfromevalu-ation&assessment
ThecaseofMothersofRotterdam
SIMPACT–T5.1|67
level. Probably theywill apply advancedquantitative statistical techniqueswith
controlgroups,becauseinthemedicalfieldthatisthenormforassessingimpact.
Theirfocuswillprobablybeonhealthoutputindicatorssuchasthesizeoftheun-
bornchild.AlthoughtheSocialinnovatoralreadyhasseenenoughevidencefrom
hisowntacitexperiences,andfromhisinformaldiscussionswithhismedicaland
socio-medical partners in the project, hewill of course follow this academic re-
searchwithinterest,andtheresultsmightserveasadditionalpiecesofevidence,
whichhecouldshowtoothers.
However,theconcerningSIwasmoreinterestedintalkingabouthowandwhythe
SIthathedevelopedworks.Hetalkedabouthistheoryofchangewhenexplaining
howtheymanagedtochangethe livesandbehaviourof thepregnantwoman in
problematicneighbourhoods.Heexplainedthattheyfirsttacklethemainstress-
causingproblem.Oftenthemayorproblemishavingahighfinancialdebt.Hehad
also readabout the theoryof scarcity (Mullainathan&Shafir2013),which con-
firmedhisexperience,thatpeopleinfinancialproblemscannotthinkproperlyan-
ymore, their IQdrops, theybehave irrational, andget themselves inall kindsof
otherproblemsasaresultofhavingsuchhighdebts.Wewon’trepeathiswhole
theory-basedimpactevaluation,butwhenweaskedifanevaluationorimpactas-
sessmenthadbeen conductedhe said “no, not yet”, andheonly referred to the
abovementionedresearchproposalofhisuniversitypartner.
EvaluationatActorLevel EvaluationatEcosystemLevel
Tacitknowledge/informallearning
• Self-evaluationindiscus-sionswithbeneficiaries,partners,donors,clients
• Organisesharedevents,net-working
• Humanmobilityschemes
Codifiedknowledge/formallearning
• Standardreportingforms• Satisfactionratings• Surveys(seeAppendix
Textbox1–VoorleesEx-press))
• Evaluationplatforms• Evaluationbyuniversity(see
AppendixTextbox1–MothersofRotterdam)
Table15. Formalandinformallearningfromevaluation
68|SIMPACT–T5.1
5.4 Light,informal&theory-basedImpactEvaluations
ReferringtotheinstrumentsmentionedinFigure14.,lightformsofevaluationare
represented in the lefthalfof thechart.For instance, “DTATellYourStory” isa
guideline for development trusts, issued by the Development Trust Association
(UK)11.Developmenttrustsfocusonpositivesocial,environmentalandeconomic
change.The“CommunityImpactMapping”usedinthisguidelineshallhelpdevel-
opmenttruststostartthinkingaboutwhyandhowtheirorganisationdoeswhatit
doesandtovisualisetheir“journey”andthedifferencetheymaketotheircommu-
nity.
TheSocialAppraisalToolkitissimilarbutincontrastto“DTATellYourStory”itis
anonlinetoolreleasedbythe“ValuingtheDifference”teamintheNorthEastofUK
withfundingfromtheEsméeFairbairnFoundation12.Theusercarriesoutanonline
self-assessmentofgovernance,socialimpacts,andfinancialviability.Thetoolalso
helpstheusertoidentifyhowkeysocialimpactdatawillbecapturedandreported
Whilethesetwotoolshavetobepurchased,theSocialReportingStandard(SRS)
canbeunderstoodasastandardisedapproachofthesamekindasthetwoprevious
tools,isafreelyavailableguidelineprovidedbytheGermanSocialReportingIniti-
ative.13
Figure15. ImpactChainoftheSocialReportingStandard
Source:AdoptedfromSRS(2014)
It aims at anoutcome-oriented learning culturebothwithin theorganisation as
wellaswithpartnersandsponsors.Itissuitableforboththeorganisation’sinternal
11Seehttp://www.dtawales.org.uk/publications/c/152/i/292/
12Seehttp://www.anybodycan.org.uk/sat.html.Thelinktothetooldidnotworkatthetimethisre-
portwasproduced.
13Seehttp://www.social-reporting-standard.de/
SOCIAL PROBLEM
VISION & GOALSRESULTS
(Outcomes & Impact)
RESOURCES(Input)
WORK PERFORMED(Output) TARGET GROUP
Community & Environment
IMPACT CHAIN
DTATellYourStory
SocialAppraisalToolkit
SocialReportingStandard
SIMPACT–T5.1|69
reportsaswellasforthetransparentrepresentationoftheorganisation’sresults
tothepublic.TheauthorshighlightthatSRSisparticularlyusefulfortheprepara-
tionofregularannualreports.Thisreportingstandardimplementstherecommen-
dationsoftheGECESSub-group(2013)insofarasitrequiresfromSItokeeptoa
strictstructure.Itstartswithanoverview(formalinformationontheorganisation,
itsvisionandapproachandthescopeofthereport),proceedswithadetailedde-
scriptionofthesocialproblemtargetedbytheSIandthesolutiontheorganisation
hasfound,includingimpact(SeeFigure15.Itendswiththeorganisationalprofile
oftheSI,whichincludesgovernance,financesandaccountingpractices.
TheSocialFirmsDashboardisnowcalledtheThirdSectorPerformanceDashboard,
whichemanatedfromtheSocialFirmPerformanceDashboardthatwasoriginally
designedforSocialFirmsandemergingSocialFirmstouseasaninternalperfor-
mancemanagement tool for theirownbusiness improvement.Thedashboard is
distributed on CD-ROM by Social Firms UK. 14 The tool helps any organisation
withinthethirdsectortomonitortheirprogressagainstobjectivesandreportas
appropriate internally and externally on actual performance. The tool is based
upon Balance Scorecard principles but acknowledges that organisations in the
thirdsectoraretypicallyshortoftimeandresources,thereforeitusestemplates
andsamples.Overall,organisationscanlogandmonitorprogressinsixdifferent
standardelementsoftheiractivities,whichcanbetailoredtotheneedsoftheor-
ganisation:
• Financial
• Governance
• Customersorexternalstakeholders
• Performanceorenvironmental
• Peopleandworklifebalance
• Marketingandcommunications
LM3standsforLocalMultiplier3andwasdevelopedbytheneweconomicsfoun-
dation(nef)asasimpleandunderstandablewayofmeasuringlocaleconomicim-
pact.15Itaimsatfollowingthe“moneytrail”that,forinstance,isgeneratedthrough
anSI’sspendinginthelocaleconomy,withthegoalofimprovingtheorganisation’s
localeconomicimpact.
14Seehttp://www.proveandimprove.org/tools/socialfirm.php#SectionFootnotesand
http://www.socialimpactscotland.org.uk/understanding-social-impact/methods-and-tools/third-
sector-performance-dashboard/.ThelinktoSocialFirmsUKdidnotworkatthetimethisreport
wasproduced.
15Seehttp://www.proveandimprove.org/tools/localmultiplier3.php
FormerSocialFirmDashboard
LM3
70|SIMPACT–T5.1
“Themeasuringprocessstartswith1)asourceofincome(saytotalincomeintoa
socialenterprise)andfollowshowitis2)spentandthen3)re-spentwithinade-
fined geographic area (that is called the ‘local economy’) (Prove and Improve
2016).”16AnothergoalofLM3istoinfluencethepublicsectortoconsidertheim-
pactofitsprocurementdecisions.Inordertomeettheneedsandcapacitiesofthe
usersitwasdesignedtobequickandrelativelyeasy.Meanwhiletherearealsocom-
mercialversionsavailablefromsuppliersthatsubsidisethenot-for-profitsector,17
thoughnefstillholdsthecopyrightoftheoriginalmanualanddistributesitforfree.
Though it is claimed that the tool is simpleandunderstandable the fivegeneral
stagestoanLM3analysis,especiallystages4and5,appearquitechallengingfor
manySIs:
1. “Determinewhatyour‘local’areais.
2. Identifywhatyourstartingpoint,oryourincomesourceis(Round1).
3. IfRound1istheorganisation’sincome,thenforRound2youneedtobreak
downhowyouspendyourincomewithinthelocalarea.
4. ForRound3,youneedtosurveythebusinessesandpeopleyouspendyour
moneyontofindouthowtheyspendtheirincomes.
5. Collateallresponses,dosomequickmaths,andthenyouhaveyourLM3
score.”18
AlimitationofLM3isthatitmeasuresonlyeconomicimpactbutnosocialorenvi-
ronmental impact. Because only economic indicators are used, this tool is posi-
tionedatthebottomlineinFigure14..
Theadvantageofsuchalightformsofsocialreportingandimpactmeasurementis
thatitisverymuchinlinewithanyorganisationsinterestin(andsometimesobli-
gationto)self-presentationandself-assessment.TheresultsoftheSIMPACTcase
studiesshowthatmanySIsdonothavetheresourcesorthecapacitiestoperform
impactassessmentbutwhensuchattemptsaremadetheycomeclosetothiskind
ofsocialreporting.Forinstance,thecasestudyofEducationforAccommodation
followedtheSocialReportingStandardapproach(Terstriepetal.2015;box3.4-
44).
However,thefactthatanumberoflinkstoorganisationsthatdistributethesetools
ortothesetoolsthemselvesdonotexistanymoreseemstosuggestthatthelifetime
ofsuchtoolsisoftenlimited.Thismaybeduetothelimiteddemandandusageof
suchtoolsbySIs, thedynamicswithin theSIsupportingsectorandthe fact that
16Seehttp://www.proveandimprove.org/tools/localmultiplier3.php
17Seehttps://www.lm3online.com/
18Quotedfromhttp://www.proveandimprove.org/tools/localmultiplier3.php
SIMPACT–T5.1|71
sometoolshavemeanwhileadvancedintoothertoolswithdifferentnames.Area-
son-besidesthelackoftimeandpersonnel-formanySIsnottousereportingand
impactassessmenttools-maybethatquiteanumberofthesetoolsandunderlying
softwareareproprietary,whichimpliesadditionalcostsforSIs.
Therearemanyothersthatonlyfollowedbitsandpiecesofsuchmethodsinanon-
standardisedway,butthisdoesnotmakethemlessaccurateorlessvaluable.Some
followtheexamplesofothersbyenteringmoreinformationintotheirannualre-
ports,whichalsoincludesinformationandindicatorsconcerning‘learning-cycleel-
ements’suchasproblem,goal,inputs,activities,results,impacts.Inseveralcases
thesocialinnovatorsdidn’trefertotheirownscientificimpactassessments,butto
impactassessmentsfromscientistsintheirfieldofSI.Inthisrespectsocialscience
andhumanitiesarewaymoreimportantsourcesforinnovationthanthetechnol-
ogyresearchfromscienceandengineeringdisciplines.Socialscienceresearchpro-
videsakindofcircumstantialevidence,whichisvalidtobackyourvalueproposi-
tion as a social innovator.However, the so-called ‘theories of change’, and logic
frameworks,donotnecessarilyhavetobeused inaheavy,andacademicmode.
Social innovators rather opt for the short catchy colourful statements on such
logics, narratives, andwisdom, onhow thingswork,why and forwhom, and in
whichcircumstances.
Giventhefactthatevensuch“lightweight”toolsareoftentoochallengingformany
SIs,duetotheirlimitedresourcesandcapacities,itisevidentthatthemorecom-
prehensiveandresource-intensivetoolsillustratedinthemiddleandintheright
halfofFigure14.areevenlessattractiveforSIs:
• BalancedScorecards(BSC)arewidelyusedincommercialbusinesses,butseemtobeattractiveprimarilyforlargecorporations.Moreover,thereare
somanyapproachestowardsBalancedScorecardsandmanyofthemhave
advancedfromarelativelysimpleperformancemeasurementtool intoa
fullstrategicplanningandmanagementsystemthatonlyveryfew–rather
largeandhighlyorganised–SIswouldbeabletouseefficiently.19
• LogicalFrameworkAnalysis(LFA)isaprojectmanagementtoolthathasoriginallybeendevelopedspecificallyfordevelopmentaidprojects,butis
meanwhileappliedinotherareasaswell.Itscoreisamatrixoffourcol-
umnsandfour(ormore)rows(theso-calledLogframeMatrix,seeanex-
ample in Figure 16) that describe “the project’s hierarchy of objectives
(ProjectDescriptionorInterventionLogic),thekeyexternalfactorscritical
totheproject’ssuccess(Assumptions),andhowtheproject’sachievements
willbemonitoredandevaluated(IndicatorsandSourcesofVerification)
(EuropeanCommission2004:57).”Eventhoughthematrixdoesnotlook
19Seehttp://balancedscorecard.org/Resources/About-the-Balanced-Scorecard
Availabletoolschal-lengesocialinnova-tors
72|SIMPACT–T5.1
verycomplicatedthecorrectandefficientuseofLFAisalignedwithcon-
siderablerequirements,pitfallsanddifficulties,asillustratedinFigure17.
Figure16. TypicalStructureofaLogframeMatrix
Source:EuropeanCommission(2004:58)
Figure17. StrengthsandCommonProblemswiththeApplicationoftheLFA
Source:EuropeanCommission(2004:59)
• Qualityoflife-andwellbeing-indicatorsmayappeareasytousebutittoidentifythemostsuitabletooloutofthenumerousindexesthatexist, to
PROJECT DESCRIPTION INDICATORS SOURCE OF VERIFICATION ASSUMPTIONS
Overall Objective - The pro-
Purpose
Results
project
Activities
ELEMENT STRENGTHS COMMON PROBLEMS/DIFFICULTIES
Problem analysis and object setting
» Requires systematic analysis of problem, including cause and effect relationships
» Provides logical link between means and ends
» Places the project within a broader development context (overall objective and purpose)
» Encourages examiniation of risks and manage- ment accountability for results
» Getting consensus on priority problems
» Getting consensus on project objectives
» Reducing objectives to a simplistic linear chain
» Inappropriate level of detail (too much/too little)
Indicator and source of verfication
» Requires analysis of how to measure the achieve- ment of objectives, in terms of both quantity and quality
» Helps improve clarity and specifity of objectives
» Helps establish the monitoring and evaluation framework
» Finding measurable and practical indicators for higher level objectives and for projects with
» Establishing unrealistic targets too early in the planning process
»
information actually comes from, who should collect it and how frequently
Format and application
» Links problem analysis to objective setting
» Emphasises importance of stakeholder analysis
» Visually accessible and relatively easy to understand
» Prepared mechanistically as a bureaucratic
analysis, objective setting or strategy selection
» Used as a means of top-down control - too rigidly applied
» Can alienate staff not familiar with the key concepts
SIMPACT–T5.1|73
carryoutthesurveyandtoanalysetheresultsrequiresspecificskillsand
mayconsumealotoftime.20
• TheSocialAuditNetworkFramework(orSocialAccountingandAudit–SAA)hasbeendevelopedbytheNewEconomicsForum(nef)andisnow
maintainedbySocialAuditNetwork(SAN)21andAccountAbility22.SAAisa
frameworkforinvestigatinganorganisation’sperformanceagainstsocial,
environmentalandeconomicobjectivesanditsvalues.Itservestomonitor,
evaluateandaccounttointernalandexternalstakeholders.SAAisclosely
relatedtocorporatesocialresponsibility(CSR)asperformedintheprivate
sector.AfteranorganisationhaslearnthowSAAworksandwhatresources
it requires and decided how the processwill bemanaged the social ac-
countingwill beperformed in three subsequentphases. In theplanning
phasetheorganisationhastoclarifyitsmission,objectives,activitiesand
underpinningvalues.Intheaccountingphasetheorganisationdetermines
the scope of the social accounts and sets upways of collecting relevant
(quantitative andqualitative) informationover a specified reportingpe-
riod,whichthenwillbeanalysed.Inthereportingandauditingphasethe
resultsof theanalysisaredocumentedandprovidedtoa listofexternal
experts (theSocialAuditPanel) forreview.After thereviewershaveac-
ceptedthisdraftthefinalreportcanbeproducedandpublished.Difficul-
tiesalignedwithSAAarethatitcanbeverytimeconsumingandthatlend-
ersandfundersdonotexplicitlyrecognisethismethod.23
• TheAA1000AssuranceStandard(AA1000AS)iscloselyrelatedtothesocialaccountingandauditingmovementfromwhichitoriginated.AA100
ASisastandardforassessingandstrengtheningthecredibilityandquality
ofanorganisation’ssocial,economicandenvironmentalreportingandpri-
marilyintendedforusebyexternalauditingbodiesthatassureanorgani-
sation’sreportsorsocialaccounts(AssuranceProviders).Itisfreelyavail-
ableandmaintainedbyAccountAbility24.Stakeholderengagement is the
keycharacteristicofAA1000AS,asitemphasisestherightofstakeholders’
intereststobeheard,andthatorganisationsaccountforthemselvesinre-
lationtotheseinterests.TothisendAA1000ASbuildsuponthreeprinci-
ples:
20Seethe–non-exhaustive–overviewsprovidedbyAlkire&Sawar(2009),Michaelsonetal.(2012),
OECD(2013),
21http://www.socialauditnetwork.org.uk/
22http://www.accountability.org/
23Seehttp://www.proveandimprove.org/tools/socialaccounting.php
24http://www.accountability.org/
74|SIMPACT–T5.1
- Materiality Principle: The organisation must include in its report infor-mation about its social, environmental and economic performance re-
quiredby its stakeholders for them to be able tomake informed judge-
ments,decisionsandactions.
- CompletenessPrinciple:Theorganisationmustbeabletoidentifyandun-derstandthematerialaspectsofitssustainabilityperformance
- ResponsivenessPrinciple: Theorganisationmustprovideevidence that ithascoherentlyrespondedtostakeholderconcerns,policiesandrelevant
standards–thisincludespublicresponsebutalsomanagementofidenti-
fiedmaterialissuesi.e.,improvingperformance.25
25Seehttp://www.proveandimprove.org/tools/aa1000AS.php
SIMPACT–T5.1|75
6 MEASUREMENTGAPANALYSIS:WHATISLACKING?
This section summarise gaps in measurement of SI, of which several already
emergedfromtheprevioussectionsandrelatetothestillnotyetstandardiseddef-
initionsconcerningSI.Comparedtootherformsofinnovation,acommonagreed
consensusondefinitionsasintheOslomanualdoesnotexistyetforSI,andstand-
ardsinpracticesamongstatisticiansconcerningmeasurementarelacking,suchas
theinternationalpracticeoftheCommunityInnovationSurveyforotherformsof
innovation. In addition, there are gaps in themeasurement of the impact of SI.
Therearedozensoftoolstomeasureimpact,whichallclaimtobethebest.Butthe
appropriatenessoftoolsdependsonmeasuringforwhom,forwhatpurposes,and
underwhatconditions.
6.1 GapsinMeasurementofSI
Besidesthefactthatsurvey-datafromsocialinnovatorsorsocialentrepreneursare
lacking,alsothemeasurementofSIinthepublicsectorandinthebusinesssector
arelacking.Thetraditionalinnovationsectorsarestartingtothinkonhowtocol-
lectdataonbeingsociallyresponsible.IntheprivatesectorthethemeisCorporate
SocialResponsibility.ThetraditionalSTIorEUresearchsectorreferstoResponsi-
bleResearchandInnovation,andhaveproposedindicatorsforthis(EU,2015b).
Butnoneofthese‘socialresponsible’initiativestoimproveindicators,isbasedon
informationfromsocialinnovators,theirusers,partners,orbeneficiaries.
MoststudiesonSIrelyoncase-studiesconcerningthemicro-level,andconcerning
themacro-level thedata isoftencollected foranotherpurpose. It concernsdata
thatcanbeusedasan indicator forcertain inputs,conditionsoroutput,but the
actualSIs,theactualactivities,theactualinnovatorsandactualusersandbenefi-
ciariesremainun-known,andarenotmeasuredbystatistics.Butalsodataonfor
instancethesizeofthethirdsectorandvoluntaryworkisnotcomparableamong
MemberStates,andlackingforsome.
TheTEPSIEstudyhasafocusonthemacrolevelofmeasuringofSI.Duetolackof
dataavailability,thisanalysis(Hubrichetal.2012:9-10)showslargedatagapsin
thecountriesconsidered,butitmakesaninterestingproposalforanindicatorset
whichcouldmeasureandmonitorwhatisgoingonconcerningSIatnationallevel.
Theirfocusisonthesupply-sideofSI,andformanyindicatorsthetechnological
Lackofdata&measurement
Casestudiesasmeansofmeasure-ment
76|SIMPACT–T5.1
component(STI)isfullyincluded.Agapinthisrespectconcernstheroleof(indi-
catorsfor)thespecificdemandforSI.Entrepreneurshipisacentralconceptinthe
TEPSIEframework.Oneofthe‘gaps’ordifficultiestheyencounteredconcernsthe
comparabilityofthedatabetweencountries,e.g.itislimitedbyconceptualandsta-
tisticaldifferencesincapturingthe“socialeconomy”orthirdsectorsineachcoun-
try. Evenwithin the same country the underlying concept to capture the social
economymayleadtoverydifferentresultswithregardtoitseconomicimpact.This
isexemplifiedbythecaseoftheUK(Hubrichetal.2012:11),wheretheshareof
expendituresinGDPis2.5%whenthevoluntarysectorisconsideredbutincreases
to 11.7%when the civil society is considered.Neither of the two concepts ade-
quatelyrepresentsthesocialeconomy,asmeantinthecontextofSI,asthevolun-
tarysectorisdefinedtoonarrowlywhilethecivilsocietyisatoobroadconcept.
Besidestheseconceptualdifficultiesthenationalcontext,inparticulartheconcept
ofthewelfarestatethatdetermineshowsocialgoodsareprovided(bypublicau-
thoritiesorbythesocialeconomy),causesadditionalproblemsinaccountingofthe
economiceffectsofSI.But,alsotheregulationsandtax lawsconcerningfounda-
tions,charities,for-profitorganisationsandnon-profitorganisationsdiffer,andare
changingfastandthismakesithardtomakeinternationalcomparisons.
Practicalproblemsofdataavailablefromstatisticaloffices,diverseauthoritiesthat
areresponsiblefortheadministrationofspecificlegalforms,privateinstitutions
thathostunofficialdata,andscientificpublicationshampertogetaclearoverview
oftheimpactofSIontheeconomy.Theseproblemscomprisediversityofdatafor-
matsandunits,dispersion,accessibilityandquality.
Improvementofthemeasurementisagradualprocess,alearningprocess.Itisim-
portantthatthelessonsarelearned,andareinstitutionalisedinnationalandinter-
nationalsurveysandstatisticalpractices.
6.2 GapsintheMeasurementoftheSIsImpact
Therearealsogapsconcerningthemeasurementof the impact.TheGECESsub-
group (2013) concluded from its evaluation of social impact measurement ap-
proachesthatnosinglesetofindicatorscanbedevisedtop-downtomeasuresocial
impactinallcases.Thereasonsforthisdifficultyaremanifold:
1. Thevarietyofthesocialimpactsoughtbysocialenterprisesisverygreatandnosinglemethodologycancaptureallkindsofimpactsfairlyorobjectively;
2. Whiletherearesomequantitativeindicatorsthatarecommonlyused,theseof-tenfailtocapturesomeessentialqualitativeaspects,or,intheiremphasisonthequantitative,canmisrepresent,orundervaluethequalitativethatunderpinsit;
Context-specificity
Dataheterogeneity
SIMPACT–T5.1|77
3. Because,owingtotheworkanddata-intensivenatureofmeasuringimpact,ob-tainingapreciseevaluationisoftenatoddswiththekeyneedforproportional-
ity.Theamountoftimespentandthedegreeofaccuracysoughtandachievedinanymeasurementexercisemustbeproportionatetothesizeoftheenterprise
andtheriskandscopefortheinterventionbeingdelivered;
4. Becauseinanareacharacterisedbywidevarietyinthenatureandaimsofac-tivities,andthetypesofSE(socialenterprise)deliveringthem,thereisacleartrade-off between achieving comparability between activities through usingcommonindicatorsandutilisingindicatorsthatareusefulandrelevantforthe
managementof thesocialenterprise; increasing(artificial)comparabilitycan
leadtoalossofrelevance
5. BecauseimpactmeasurementandtheworldofsocialenterpriseandSIhasbeenevolvingveryrapidly,itisdifficulttosticktoanyonestandardoveranumberofyears.
Anothergapthatshouldbeaddressedisthemethodologywithwhichtoapproach
SI impactmeasurement. The accounting and returns on investment approaches
clearlyleantoomuchtowardsapurelyquantitativeapproach,andareverycostly.
Putting aside the positivist-constructivist debate, the use of mixed methods
(Tashakkori&Teddlie,2003)inthecollectionofmeaningfuldatatomeasureSIis
themostlikelyandproductivewayforward.Themixedmethodsapproachentails
aconvergenceofboththequantitativeandqualitativelyfocusedmethods(andpar-
adigms;seeCreswell&PlanoClark,2007).Anexample,fromsurveying,wouldbe
a follow-up qualitative question to explain, and contextualise, the results of the
quantitativepartofthesamequestion.Thiswouldenablethesurveyorstoaddress
themorequalitative"usevalue"partofSI.Casestudyandinterviewdesigninspired
methodswouldassuchfindaplaceinalargersurveycampaignexploringtheSI
space.
Mixedmethodsapproach
78|SIMPACT–T5.1
7 INDICATOR-BASEDPROFILINGOFSIATMICROLEVELOFSIMPACTCASESTUDIES
7.1 SurveyofSIMPACTCaseStudies
Inworkpackage3ofSIMPACTtwokindsofqualitativecasestudieshavebeenpro-
duced:SIBiographiesandBusinessCases.IntheAppendix,theGuidingquestions
fortheSIB’sareincluded.Theseopenquestionsservedasachecklistfortheinter-
viewsandthetextofthecasestudieshasthesamestructure.TheBusinessCases
haveaslightlydifferentstructure,butlargelythesametopicshavebeenaddressed
inbothtypesofcasestudies.Thesurveywithclosedquestions(Table16.)started
withafewquestionswhichwerethesameasintheSIBs,andtoalargeextentfol-
lowedthestructureandconceptsusedintheguidelinesfortheSIBs(e.g.concern-
ingthethematicfield, geographicalscale,developmentstage,etc.). AllSIBsand
BCsareincludedandtwoadditionalcaseswhichhavebeenperformedunderWP1,
resultingintheSIMPACTdatabaseof55casesofSI.Itemnon-responsehasbeen
addressedbyenteringthemeanvaluefortheconcerningitem.
Thesurveyhasbeenconductedon-lineinthebeginningof2016andthequestions
havebeenansweredasmuchaspossibleby theauthorsof thecasestudies,but
otherwisebyotherSIMPACTpartnerswhofilledinthesurveyafterhavingreadthe
concerningin-depthcasestudyreport.Thefirstpartofthesurveyconsistsofques-
tionswhichcouldbeansweredwithyesorno,butthelargestpartofthequestions
askforaratingonaLikert-typescale,rangingfromveryhightoverylow.
BesidesquestionsonthetypeofSI,theactorsinvolved,andtypeoffunders,there
areseveralmaingroupsofquestionson:objectives,inputofresources,obstacles,
and output/outcomes. The first eight output questions ask to rate the likely
achievedimprovementsforthemarginalisedtargetgroup.Thenexteightoutput
questionsaskforaratingoftheimprovementsforthesocialinnovator.Afterfour
otheroutputquestionsandaratingofthelong-termperspective,thelastpartof
the survey consists of questions related to themain conclusions from thework
package3 analysis as reported inD3.2 (Terstriep et al. 2015).The respondents
wereasked: “Howdoyou rate theextent towhich the followingWP3empirical
findingsapplytothiscase”.Thispartofthesurveyhasnotbeenanalysedforthis
deliverable,butwillservetocomplementtheanalysisofwp3andotherworkpack-
ages.
SIMPACT–T5.1|79
Table16. Surveyquestionsandcodeusedindatabaseandgraphs
Question Code
PleasefillinthenameofSI(Biographyorbusinesscase) case_name
Thematicfield(Problemaddressed)[Employment] Employment
Thematicfield(Problemaddressed)[Migration] Migration
Thematicfield(Problemaddressed)[Demographics] Demographics
Thematicfield(Problemaddressed)[Gender] Gender
Thematicfield(Problemaddressed)[Education] Education
Thematicfield(Problemaddressed)[Poverty] Poverty
Country Country
NUTScode(ornameofregionoforigin/locationofsocialinnovator) nuts
PleaseindicatebelowthegeographicalscaleoftheSI.[Local] scale_local
PleaseindicatebelowthegeographicalscaleoftheSI.[Regional] scale_reg
PleaseindicatebelowthegeographicalscaleoftheSI.[National] scale_nat
PleaseindicatebelowthegeographicalscaleoftheSI.[Europe] scale_eu
PleaseindicatebelowthegeographicalscaleoftheSI.[World] scale_world
Developmentstage[Ideation] stage_idea
Developmentstage[Prototyping] stage_proto
Developmentstage[Implemented] stage_impl
Developmentstage[Scaled] stage_scaled
Developmentstage[Discarded] stage_disc
Prospectsforexpansion[Prospectsforexpansion] prospect
Whattypeoforganisationisthesocialinnovator-[Typeoforganisation] Typeoforganisation
WhattypeofSIisit-[NewProduct/service] typeSI_prod
WhattypeofSIisit-[Newmarket/ortargetgroup] typeSI_newmarket
WhattypeofSIisit-[Newtargetgroup] typeSI_newgroup
WhattypeofSIisit-[Organisationalinnovation] typeSI_orga
WhattypeofSIisit-[Newmethod,process-innovation] typeSI_proces
WhattypeofSIisit-[Newinputs(expertise,ICT,design-skills,material,etc.)] typeSI_input
WhattypeofSIisit-[Other] typeSI_other
Knowledgebase[Howwouldyouratethesocialinnovator'sinternalknowledgebaseonthethemeandtargetgroup-]
KB_int
Knowledgebase[HowwouldyouratetheSI'suseofexternalknowledgeonthethemeandtargetgroup-]
KB_ext
Knowledgebase[Howwouldyouratethebusinessknowledge,andmanagementca-pabilitiesofthesocialinnovator-]
KB_bus
80|SIMPACT–T5.1
Question Code
Actorsandcollaborations[ApproximatelyhowmanyactorsareinvolvedintheinnercoreoftheSI-]
innercore
Actorsandcollaborations[Approximatelyhowmanyorganisationscollaborateaspart-ners,promotors,andsupportersoftheSI-]
supporters
Actorsandcollaborations[Howwouldyouratethediversityoftheactorsinvolved-] act_diversity
Fundingandfinance[PleaseratetheextenttowhichtheSIgeneratesrevenues/sales-] generate_rev
TypeoffunderThemainfunderistheorganisationthatfundsthehighestshareofthebudgetoftheSI.[WhatkindoforganisationisthemainfunderoftheSI-]
type_fund
TypeoffunderThemainfunderistheorganisationthatfundsthehighestshareofthebudgetoftheSI.[Secondmainfunder]
type_fund2
TypeoffunderThemainfunderistheorganisationthatfundsthehighestshareofthebudgetoftheSI.[Thirdmainfunder]
type_fund3
PleaseratetheimportanceofthefollowingobjectivesfortheSI.[Correctingamarketfailureinservingunmetneedsofthetargetgroup.]
obj_mark_fail
PleaseratetheimportanceofthefollowingobjectivesfortheSI.[Complementingpub-licpolicyinservingunmetneeds
obj_compl
PleaseratetheimportanceofthefollowingobjectivesfortheSI.[Businessopportuni-ties(increaserevenues/profit)]
obl_bus
PleaseratetheimportanceofthefollowingobjectivesfortheSI.[Increasetheeco-nomicvalueofcapabilitiesofthetargetgroup(e.g.Employability,work-skills).]
obj_ec_cap_target
PleaseratetheimportanceofthefollowingobjectivesfortheSI.[Increasetheper-sonal&socialvalue/capabilitiesofthetargetgroup(e.g.Empowerment,health,life-skills,self-confidence)]
obj_soc_cap_target
PleaseratetheimportanceofthefollowingobjectivesfortheSI.[Increasethepublicvalue/capabilitiesofthetargetgroup(socialcohesion,inclusion,lobbying,legitima-tion)]
obj_pub_cap_target
Pleaseratetheimportanceofthefollowingresources(andactivities)asinputsoftheSI.[Knowledge(e.g.fromexperts,knowledgeinstitutes,students)]
imp_res_experts
Pleaseratetheimportanceofthefollowingresources(andactivities)asinputsoftheSI.[Labour]
Imp_res_labour
Pleaseratetheimportanceofthefollowingresources(andactivities)asinputsoftheSI.[Capital/funding]
imp_res_cap
Pleaseratetheimportanceofthefollowingresources(andactivities)asinputsoftheSI.[ICT]
imp_res_ICT
Pleaseratetheimportanceofthefollowingresources(andactivities)asinputsoftheSI.[Socialcapital(engagement,volunteering)]
imp_res_soc_cap
Pleaseratetheimportanceofthefollowingresources(andactivities)asinputsoftheSI.[Relationalcapital,resources,networking]
imp_res_rel_cap
Pleaseratetheimportanceofthefollowingresources(andactivities)asinputsoftheSI.[Training,education]
imp_res_train
Pleaseratetheimportanceofthefollowingresources(andactivities)asinputsoftheSI.[Politicalsupport]
imp_res_politic
SIMPACT–T5.1|81
Question Code
PleaseratetheimportanceofthefollowingobstaclesfortheSI-[Financial] imp_obs_fin
PleaseratetheimportanceofthefollowingobstaclesfortheSI-[Organisational/logis-tical]
imp_obs_org
PleaseratetheimportanceofthefollowingobstaclesfortheSI-[Legal] imp_obs_legal
PleaseratetheimportanceofthefollowingobstaclesfortheSI-[Political] imp_obs_political
PleaseratetheimportanceofthefollowingobstaclesfortheSI-[Societal/cultural] imp_obs_soc
PleaseratetheimportanceofthefollowingobstaclesfortheSI-[Marketshare(com-petition)]
imp_obs_mark_share
PleaseratetheimportanceofthefollowingobstaclesfortheSI-[Technological] imp_obs_tech
PleaseratetheimportanceofthefollowingobstaclesfortheSI-[Other] imp_obs_other
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Increasedlifeskillsofthemarginalised]
outc_lifeskills
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Increasedworkingskillsofthemarginalised]
outc_workskills
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Increasedphysicalcapa-bilitiesofthemarginalised]
outc_phys_cap
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Increasedothercapabili-tiesofthemarginalised]
outc_cap_other
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Improvednetworksofthemarginalised]
outc_network
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Improvedself-confidenceofthemarginalised]
outc_self_conf
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Employmentofthemar-ginalised]
outc_employment
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Improvedincome/lesscostsforthemarginalised]
outc_impr_income
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Increasedmanage-ment/businesscapabilitiesofthesocialinnovator]
outc_SI_bus_cap
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Increasedmarketingca-pabilitiesofthesocialinnovator]
outc_SI_mark_cap
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Otherincreasedcapabili-tiesofthesocialinnovator]
outc_SI_cap_other
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Improvednetworksofthesocialinnovator]
outc_SI_netw
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Improvedself-confidenceofthesocialinnovator]
outc_SI_selfconf
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Employmentgrowthatthesocialinnovator]
outc_SI_empl
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Improvedrevenues/lesscostsforthesocialinnovator]
outc_SI_rev
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Aviablebusinessandachievingfinancialsustainability]
outc_SI_stability
82|SIMPACT–T5.1
Question Code
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Reducedpublicbudgetcosts]
outc_SI_pub_budg
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Othercomplementstopublicpolicy]
outc_public_other
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Otherbenefitsforprivatepartners]
outcome_privateother
Pleaseratethelikelyachievedoutcomes/outputsoftheSI.[Othercivicout-comes/benefits]
outc_civic_other
Howwouldyouratethelong-termoutlookoftheSIonascaleof1to10- LT_outlook
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[PublicsectorcanfunctionasinnovatoranddriverofSI]
WP3_pubsect
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[socialinnovatorsfindthemselvesintheconstraintsituationofneitherqualifyingascommercialenterprisenorassocialenterprise]
WP3_constraint
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[socialinnovatorsbehaveADAPTIVEratherthanRATIONAL]
WP3_adapt
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Varioustypesofinteractionswithdistinctactorsarecommonpractice]
WP3_interact
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Interactionswithprivateactorsaremostlyutilisedtocloseexistingknowledgegaps]
WP3_gaps
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Publicauthoritiesoftenonlyengageiftheyhaveadirectbearingontheissueaddressedbythesolution,inparticular,intheearlystage]
WP3_publ_eng
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Combiningeconomic&socialresourcesisamustforSI]
WP3_ec_soc
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[IntheinitialstageoftheSIprocessinnovatorsoftenlackfinancialresources,makingitdifficulttosecuretheirownincome,paystaffwages,etc.]
WP3_secure
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[(Public)fundingnecessitatesrecognition]
WP3_recogn
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Relationalcapitalcontributestoreducinguncertaintyinaconstantlychangingenvironment]
WP3_rel_cap
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[BroadknowledgeindistinctdomainsappearsasakeysuccessfactorinSI]
WP3_know
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Socialinnovatorsknowthesocialproblemverywell,thewayitissolvedmaybringthemincompletelyunknownfieldsofactivityandbusiness.]
WP3_fields
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Lackofbusiness,industryandmanagerialknowledgeleadstofailure]
WP3_lack_skills
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Formulatingavaluepropositioninwhichsocialandeconomicobjectivesarebal-ancedisofparamountimportancetoensuresustainabilityofSI]
WP3_valueprop
SIMPACT–T5.1|83
Question Code
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Scalingout(diffusion)isforemostbasedonthespreadoftheideaorframeworksolution,byimitation,adaptionandlearning]
WP3_diffuesion
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Scalingupismorelikelytobefoundinfor-profitorganisations]
WP3_scaling_up
HowdoyouratetheextenttowhichthefollowingWP3empiricalfindingsapplytothiscase-[Actorsconstellationandformoforganisationaresubjecttochangethroughouttheinnovationprocessandbeyond]
WP3_actors
7.2 ExplorativeMethodology:CategorisationbyPrincipalComponentAnalysis
Table17. Overviewofstudiesidentifyingfirmlevelinnovationmodes
InnovationMetho-dology
Measuresfeedingintomodes Data Study
Mode1:‘Sciencebasedhigh-techfirms’Mode2:‘IT-orientednetwork-in-tegrateddevelopers’Mode3:‘Market-orientedincre-mentalinnovators’Mode4:‘Cost-orientedprocessinnovators’Mode5:‘Low-profileinnovators’
Exploratory Inputs,outputs,linkages
SwissInnova-tionsurvey1999PrivateServicesSector
Hollenstein(2003)
Mode1:‘StrategicInnovators’Mode2:‘IntermittentInnovators’Mode3:‘Technologymodifiers’Mode4:‘Technologyadopters’
Prescriptive Technologicalin-putsandoutputs
EurostatNewCronos(largelyEuro-statCIS3data)
Arundel&Hollanders(2005)
Mode1:‘Science,TechnologyandInnovation’(STI)Mode2:‘Doing,Using,Interact-ing’(DUI)
Prescriptive Inputs,organisa-tional
2001DanishDISKOSurvey
Jensenetal.(2007)
Mode1:‘Science-based’Mode2:‘Specialisedsuppliers’Mode3:‘Supplier-dominated’Mode4:‘Research-intensive’
Exploratory Inputsandoutputs,linkages,organisa-tional
SurveyofSMEsintheNether-lands2003
DeJong&Marsili(2006)
Mode1:‘Science-based’Mode2:‘Supplier-dominated’Mode3:‘Productionintensive’Mode4:‘Marketdriven’
Exploratory Mainlyinputs,link-ages
CIS2forDen-markandFin-land
LeponenandDrejer(2007)
Mode1:‘Research’Mode2:‘User’Mode3:‘External’Mode4:‘Production’
Exploratory AllCISvariablesavailable
EurostatCIS3 Srholec&Verspagen(2008)
Mode1:‘New-to-marketinnovat-ing’’Mode2:‘Marketing-basedimitat-ing’Mode3:‘Processmodernising’
Exploratory Inputsandoutputs Innovationsur-veyof9OECDcountries
Frenz&Lam-bert(2009)
Theuseofexplora-tivemethodologytoidentifyfirmlevelmodesofbusinessinnovation
84|SIMPACT–T5.1
InnovationMetho-dology
Measuresfeedingintomodes Data Study
Mode4:‘Widerinnovating’
Mode1:‘Organisationalinnova-tions’Mode2:‘Technologicalinnova-tions’
Exploratory Mainlyoutputs UKCIS4 Battisti&Stoneman(2010)
Source:Frenz&Lambert(2012)
Manyauthorshaveshownpatternsinthewayfirmsinnovatebyacombinationof
resources,activitiesandcapabilities.Someofthemusesurveydatatoidentifydif-
ferentmodes(types,models,strategies)of innovation,mostlybasedonCISdata
whichrelatestoavarietyofanswersfromfirmstoquestionsconcerninginnova-
tions.Pavitt(1984)wasoneofthefirsttoshowwithhistaxonomyofinnovating
firms that the sources andpurposes of innovation arediverse and that one can
identifydifferentmodesofinnovation.Hemainlyrelatedthetypesandmodesof
innovation to sectors, showing that they are industry-specific in the sense that
somemodesaremorefrequentincertainindustries.ThetaxonomyofPavittisstill
visibleintheresultsofotherswhostudiedthis(Table17).
Table17givesanoverviewprovidedbyFrenzandLambert(2012)ofsomestudies
whichhavefollowed-upthesearchforpatternsinfirm-leveldata,henceidentifying
maintypesormodesofinnovation.Theyrefertothesemodesas‘mixedmodes’,as
they indeedrefer tocertaincombinationsof innovationresources,activitiesand
outputswhichoftencanbefoundin(theCISanswersfor)onefirm.Therearetwo
methodstocometosuchatypology:eitherprescriptiveorexploratory.Theexplor-
atorymethods‘letthedataspeak’byidentifyingpatternswithforinstancefactor
analysis (also known as data-reduction and principle component analysis). We
chooseinthisstudyforthissecondmethodology,becauseitcombinestheinsights
fromtheoryandempiricalobservations,andbecauseitisagoodmethodologyto
developindicatorsinemergingfieldsorresearch,whenstandardsindefinitionsof
conceptsandstatisticaldataarestill lacking.Anexampleof thisexploratoryap-
proach isSrholecandVerspagen (2008;2012)who take thebroadest setofCIS
variablesintotheanalysisanduseatwo-stepfactoranalysis.Theresultleadsto
fourinnovationstrategiesormodes,whichSrholecandVerspagenhavegiventhe
followinglabels:‘Research’,‘User’,‘External’and‘Production’(Table18).Socialre-
sponsibilityispartofthemodelabelled‘production’.
Patternsofinnovation
Prescriptiveandex-ploratorytypology
methods
SIMPACT–T5.1|85
Table18. Hierarchicalfactoranalysis(2ndstage)oningredientsoffirminnovationstrategies:4modes
(1)Research
(2)User
(3)External
(4)Production
R&D 0.70 0.07 −0.16 0.09
Marketing 0.07 0.65 0.01 −0.16
Externalinputs 0.16 −0.13 0.65 0.02
Producteffects −0.01 0.69 −0.03 0.15
Processeffects −0.08 0.06 0.02 0.81
Socialresponsibil-ity
0.08 −0.07 0.01 0.83
Informationfromscience
0.62 0.01 0.31 0.06
Informationfromclientsandindus-try
−0.01 0.61 0.28 −0.07
Informationfromsuppliersandevents
−0.07 0.23 0.69 0.10
Formalprotection 0.36 0.37 −0.27 0.05
Informalprotec-tion
0.42 0.35 −0.18 0.01
Non-technologi-calinnovation
0.00 0.53 0.02 0.12
Innovationco-op-eration
0.78 −0.06 0.06 −0.09
Source:Srholec&Verspagen(2012:1237)
Studieswhichtrytomeasurewhichkindofinnovations(product/process/organ-
isational/marketing)generatemoregrowthintermsofturnoverorjobsgivemixed
results.LachenmaierandRottmann(2010)concludethatprocessinnovationshave
ahigherpositiveeffectonemploymentthanproductinnovations.Productinnova-
tionsontheotherhandaremoreoftenassociatedwithgrowthinturnover.Forpol-
icymakers,however,thelessonisthattherearenogoodreasonstopromoteonly
onetypeofinnovation,oronemodeofinnovation.Innovationpolicieswhichapply
toabroaderunderstandingofinnovationandwhicharenotlimitedtoR&Dorprod-
uctinnovation,aremorelikelytoimpactongrowthoffirms,andSMEsinparticular
(Wintjes2014).
Thefactthatthereareclearsimilaritiesinthemodes,whicharefoundinthevari-
ousstudies(usingvariousmethodsandindicatorsets,andwithdifferentfocusof
analysis in termsofcountriesorsectors), support theconclusionofSrholecand
Verspagen(2012)thattoahighdegreethesemodes(andtheheterogeneitythey
represent)canbefoundinallsectorsandallcountries.There is,sotospeak,no
Nosinglebestpracticemode
86|SIMPACT–T5.1
convergencetoasinglebestpracticemodeof innovation.Fromanevolutionary,
(eco-)systemperspective,itishealthytohavethisdiversity,whichallowsfornovel
combinations.Therefore,policymakersshouldnotreducethevarietyofmodes,but
rathermaintainthediversity,andforinstancestrengthen‘weakmodes’.Thisalso
impliesthatthereisnosinglebestpracticepolicy,whichpolicymakerscancopyas
a‘one-size-fits-all’policyfromotherregionsorsectors.Designingtheappropriate
innovationpolicymixforagiveninnovationsystem,callsforaninteractiveprocess
inordertocometoatailoredpolicymix.
7.3 ResultsofFactorAnalysis
Firstwepresenttheresultsforfactoranalysesperformedonthefollowinggroups
ofvariablesrelatedto:input,objectives,obstacles,andoutput.
Theinformationcollectedwiththe14questionsrelatedtoinput(includingtheim-
portanceofresources,numberofactorsinvolved,andtheratedknowledgebase)
hasbeenreducedintofivefactors(Table19).Thefirstinputfactorwehavelabelled
‘Lownr.Supportingactors’,becauseitconsistsoftwohigh,negativeloadingsfor
questionsonthenumberofactors(innercoreandsupporters)involvedintheSI.
Wenotice thata lownumberofactors isassociatedwitharelativelyhigher im-
portanceofpoliticalsupportasinput(imp_res_politic).
Theimportanceof:actordiversity,labourasaresource(e.g.:volunteers),andthe
useofexternalknowledgeonthethemeandtargetgroup,aretogetherininputfac-
tor2,whichislabelled:‘Diversityofknowledge’.Thecompositionofthisfactorsug-
gest that volunteers not only put in free labour, but also a different kind of
knowledgeonthethemeandtargetgroup.
Inputfactor3islabelled‘Socialcapital’,whichalsoincludeshighratedimportance
asaresourceofrelationalcapital(imp_res_rel_cap)fortheconcerningSI.
Inputfactor4islabelled‘ICT&funding’sincethisresourcecomponentconsistsof
theco-importanceofICTandfundingasaresourceforSI.
The5thinputfactorconsistsofhighfactorloadingsforanswersonthreeknowledge
questions:theimportanceofknowledgeasaninput,e.g.fromexperts,knowledge
institutes,students(imp_res_experts),theratedinternalknowledgebaseofthein-
novatorconcerningthethemeandtargetgroup(KB_int),andtheratedimportance
oftrainingandeducationasaninputtotheSI(imp_res_train).
Numberofsupportingactors
Diversityofknowledge
Socialcapital
Importanceofknowledge,
knowledgebase,training&education
SIMPACT–T5.1|87
Table19. Typesofresources/inputstoSI,patternmatrixoffactoranalysis
INPUTFACTORS:TYPESOFRESOURCES/INPUT
1Lownr.sup-portingactors
2Diversityofknowledge
3Socialcapital
4
ICT&funding
5
Knowledge
innercore -.853
supporters -.818
imp_res_politic .504 .445
act_diversity .771
Imp_res_labour .628
KB_ext .574 .525
KB_bus .511 .443
imp_res_soc_cap .862
imp_res_rel_cap .858
imp_res_ICT .746
imp_res_cap .707 .374
imp_res_experts .770
KB_int .635
imp_res_train .565
Note:ExtractionMethod:PrincipalComponentAnalysis.RotationMethod:ObliminwithKaiserNormalisation.
Patternmatrix,rotationconvergedin18iterations.Highfactorloadingsemphasisedinbold,below0.3suppressed.Totalvarianceexplainedby5factors=64.6%
InFigure18weseethatSIswhichoperateonalocalscalehaveafaraboveaverage
scoreonthefactor‘Lownr.supportingactors’.Sincethenumberofinnercoreac-
torsandnumberofsupportershasanegativeloadinginthisfactor,itmeansthat
theSIswhichoperateat localscalehaveonaveragealowernumberof involved
actors,andpoliticalsupport ismore important for them,comparedtoSIswhich
operateatnationalscale.Wehavetonotethatrespondentscouldindicatethatthe
concerninginnovationisimplementedatseveralscales.SIsatanationalscalehave
onaveragearelativelylargenumberofactorsandsupporters,andpoliticalsupport
islessimportantasaninput.Oftentheyoperateinmultiplelocations.ForSIsoper-
atingattheregionalleveltheinputprofilesquiteresemblethosethatareopera-
tionalatnationallevel,exceptforthisfactorconcerningthenumberofactors,on
whichthepositionofthoseatregionallevelisinbetweenthepositionofthoseat
localandnationallevel.
Operationallevel
88|SIMPACT–T5.1
Figure18. SIinputprofilesbygeographicalscale
TherearealsootherdifferenceswhenwecomparetheSIinputprofilesofthecases
accordingtothegeographicalscaleatwhichtheyoperate.Forthosewitha local
scale,thefactorscoreson‘Diversityofknowledge’isbelowaverage(indicatedby
theorangeline,whichistheaverageofallcases).ThisismoreimportantfortheSIs
thatoperateatnationallevel.Characteristicforthoseoperatingatnationallevelis
the relatively low importance of the input factor ‘Knowledge’. The on average
higherinputfactorscoresfor‘ICT&funding’suggeststhatatanationalscale,in-
vestmentsinICTbecomemoreimportantinrelationtothediffusion(scalingout)
orscaling-upoftheinnovation.
Figure19. SIinputprofilesbytheme
-0,2-0,1
00,10,20,3
Low nr. supporting
actors
Diversity of knowledge
Social capitalICT & funding
Knowledge
scale_localN = 26
-0,4-0,3-0,2-0,1
00,10,2
Low nr. supporting
actors
Diversity of knowledge
Social capitalICT & funding
Knowledge
scale_natN = 24
-0,1
0
0,1
0,2
0,3
Low nr. supporting
actors
Diversity of knowledge
Social capitalICT & funding
Knowledge
EmploymentN = 35
-0,3-0,2-0,1
00,10,20,30,4
Low nr. supporting
actors
Diversity of knowledge
Social capitalICT & funding
Knowledge
Migration N=11
-0,6-0,4-0,2
00,20,4
Low nr. supporting
actors
Diversity of knowledge
Social capitalICT & funding
Knowledge
Demographics N=14
-0,4-0,3-0,2-0,1
00,10,20,3
Low nr. supporting
actors
Diversity of knowledge
Social capitalICT & funding
Knowledge
Education N=19
Geographicscales
SIMPACT–T5.1|89
Ahighinputfactorscoreon‘Knowledge’andtherelativelylowimportanceof‘So-
cialcapital’asinputischaracteristicforSIswithinthethemeofemployment(Fig-
ure19).Theonaveragelowinput-factor‘Knowledge’,andahighscoreonthe‘ICT
&funding’componentischaracteristicforSIinputsinthefieldofdemographics.
TheinputprofilesforSIsinthefieldsofmigrationandeducationhavesomesimi-
larities:lownumberofactors,lowon‘Diversityofknowledge’,andhighon‘Social
capital’asinputfactors.However,onaveragethefactorscoresfor‘Knowledge’and
‘ICT&funding’arehigherforSIsinthethemeofEducation.
SIsfromNGOs&thirdsectororganisationshaveaboveaverageinput-factorscores
exceptonthefactor‘Diversityofknowledge’.Thiskindofspecialisationseemsas-
sociatedwithalimitednumberofactorsandcollaborations,andahighimportance
ofpoliticalsupportasaninput.These2inputfactorswhicharecharacteristicsof
SIsbyNGOs, actually seem tobeassociatedwith success, in the sense thathigh
numberofactors,anddiversityofknowledge,seemscharacteristicforSIswitha
verypositivelongtermperspective(Figure20).
Figure20. SIinputprofileforNGOs&forinnovatorswithalong-termoutlookratedasverypositive
Concerningtheobjectives(Table20)thefactoranalysisresultsintwocomponents,
indicatingtwotypesofSIobjectives,whichwecannamerespectively:‘Publicvs.
Business’,and‘Socio-economictargetgroup’.Thefirstfactorinvolvesarelatively
high importanceof theobjective to improvepublicaspects for the targetgroup,
concerning for instance social cohesion, inclusion, lobbying, legitimation
(obj_pub_cap_target),while having at the same time a low rated importance for
business opportunities (increase revenues/profit) as the objective of the SI
(obj_bus).Thecompositionofthisfactorsuggeststhatitisdifficulttoservethese
twoobjectiveswithoneSI.
Thesecondobjectivefactorislabelled‘Socio-economictargetgroup’,becauseboth
the objective to increase the personal & social value/capabilities of the target
group,e.g. empowerment,health, life-skillsandself-confidence (obj_soc_cap_tar-
get),aswellastheobjectivetoincreasetheeconomicvalueofcapabilitiesofthe
-0,10
0,10,20,30,4
Low nr. of supporting
actors
Diversity of knowledge
Social capitalICT & funding
Knowledge
NGO & Third sectororganisation N=14
-0,3-0,2-0,1
00,10,20,3
Low nr. supporting
actors
Diversity of knowledge
Social capitalICT & funding
Knowledge
Very positive LT outlook SI N=32
SIThemes
SIOrganisations
SIObjectives
90|SIMPACT–T5.1
targetgroup,e.g.Employabilityorwork-skills(obj_ec_cap_target)showhighload-
ingswithinthis2ndobjectivefactor.
Table20. TwotypesofSIobjectives,patternmatrixoffactoranalysis
FACTORSOFSIOBJECTIVES
1Publicvs.Business
2Socio-economictargetgroup
obj_bus -.620
obj_pub_cap_target .591 .475
obj_mark_fail .442
obj_soc_cap_target .386 .665
obj_ec_cap_target -.590 .640
obj_compl .309
Note:ExtractionMethod:PrincipalComponentAnalysis.RotationMethod:ObliminwithKaiserNormalisation.Ro-tationconverged in2 iterations.Highfactor loadingsemphasised inbold,below0.3suppressed.Totalvarianceexplainedby2factors=44.7%
Regardingobstaclestheanalysisresultsinthreecomponents,whichcanbeinter-
pretedasthreetypesofobstacles(Table21).Thefirstfactor,whichexplainsthe
largestshareofthetotalexplainedvariancecomprisesorganisationalandlegalob-
stacles.Thisresultconfirmstheanalysisofthecasestudiesthat it isdifficult for
manysocialinnovatorstofindoneappropriateorganisationalform,andtheythere-
foreoftenchoseforhybridformsoforganisationbecauseoflegalobstaclestocom-
binetheirbusinessandsocialobjectivesinonelegalorganisationalform.Wethere-
forelabelthisfirstobstaclefactor:‘Hybridissue’.Thesecondobstaclefactorbrings
togethersocietal/cultural,financialandpoliticalobstacles.WhenSIsfaceallthese
obstacleswecanlabeltheconcerningSIsas‘radical’.Adifferentkindofobstacleis
inthethirdfactor,wheretechnologicalobstacleshavethehighestfactorloadings,
butalsowheremarket share (competition) is rate relativelyhighasanobstacle
(imp_obs_mark_share).
Table21. TypeofSIobstacles,patternmatrixoffactoranalysis
THREETYPESOFSIOBSTACLES
1
Hybridissue
2
RadicalSI
3Technologicalcompetition
imp_obs_org .876
imp_obs_legal .833
imp_obs_soc .873
imp_obs_fin .703
imp_obs_political .498 .605 -.318
SIObstacles
SIMPACT–T5.1|91
THREETYPESOFSIOBSTACLES
1
Hybridissue
2
RadicalSI
3Technologicalcompetition
imp_obs_tech .823
imp_obs_mark_share .691
Note:ExtractionMethod:PrincipalComponentAnalysis.RotationMethod:ObliminwithKaiserNormalisation.Rotationconvergedin13iterations.Highfactorloadingsemphasisedinbold,below0.3suppressed.Totalvarianceexplainedby3factors=68.7%
Withregardtotheoutcomequestions,wereportonthe6factorsresultingfromthe
principal component analysis,which together explain 67%of the total variance
(Table22).Thefirsttwocomponentsbothconcerneconomicoutcomes,butinthe
firstfactorweseehighloadingsofeconomicimprovementsforthesocialinnovator
in terms of financial sustainability, revenues, business capabilities and employ-
ment.Inthesecondeconomicoutputfactorwenoticehighfactorloadingsforim-
pactonemployment,incomeandworkskillsforthetargetgroup.Athirdtypeof
outputrelatestosocialcapitalofthemarginalised,intheformofimpactonself-
confidenceofthemarginalised(outc_self_conf),andimprovednetworksofthemar-
ginalised(outc_network).Wehavethereforelabelledthisoutcomefactor‘socialfor
targetgroup’.Thefourthoutcomefactorislabelled‘Physicalcapability’,whichalso
includesincreasing‘life-skills’.Outcomefactor5islabelled‘Publicbudget’,butwe
couldalsohavelabelledit ‘economyforgovernment’.Thisimpactfactorisbased
onhighfactorloadingsfor:‘Reducedpublicbudgetcosts’(outc_SI_pub_budg)and
‘Other complements topublicpolicy’ (outc_public_other). Finally, a6th factor in-
volves:‘Othercivicoutcomes/benefits’(outc_civic_other),butbecauseofthelower
contributiontothetotalexplainedvariance,wedonotshowthescoresonthisout-
comefactorintheSIoutcomeprofiles.
Table22. TypesofSIoutput/outcome,patternmatrixoffactoranalysis
TYPESOFSIOUTPUT
1Economyin-novator
2Economy
targetgroup
3Socialfortar-getgroup
4Physicalcapability
5Publicbudget
6
Civicother
outc_SI_stability .856
outc_SI_rev .841
outc_SI_bus_cap .827
outc_SI_empl .817
outc_SI_mark_cap .776
outc_SI_netw .691
outcome_privateother .665
generate_rev .580 .527
outc_SI_selfconf .534 .468
SIOutcomes
92|SIMPACT–T5.1
TYPESOFSIOUTPUT
1Economyin-novator
2Economy
targetgroup
3Socialfortar-getgroup
4Physicalcapability
5Publicbudget
6
Civicother
outc_employment .983
outc_impr_income .897
outc_workskills .880
outc_network .744 -.310
outc_self_conf .691
outc_SI_cap_other .522 .555
outc_phys_cap .873
outc_lifeskills .713
outc_cap_other .331 .430 .400
outc_SI_pub_budg .772
outc_public_other .572 .552
outc_civic_other .771
ExtractionMethod:PrincipalComponentAnalysis.RotationMethod:ObliminwithKaiserNormalisation.Rotationconvergedin40iterations.Highfactorloadingsemphasisedinbold,below0.3suppressed.Totalvarianceexplainedby6factors=67.0%
Lookingattheoutcomeprofiles,andcomparingtheaveragefactorscoresofthe15
caseswitharegionalscalewiththeaveragesforthe24whichareoperationalat
nationalscaleshowsthatthecasesatregionalscaleonaveragegeneratemoreeco-
nomicoutput for the targetgroup,while theSIsatnational levelgeneratemore
economicimpactforthesocialinnovator(Figure21).Theaverageoutcomeprofile
of theSIsat localscaleshowahighscoreon the impact factors: ‘Publicbudget’,
‘PhysicalCapability’,and‘Economytargetgroup’.Theeconomicimpactsfortheso-
cial innovators, themarginalised target group, and the public budget, seems to
changewithanincreasinggeographicalscale.FromSIatlocalleveltheeconomic
impactforthetargetgroupandthepublicbudgetisonaveragehigher,butfrom
implementationatnationalscalethebenefitsfortheinnovatorarebetter(Figure
21).
Figure21. OutcomeprofileforregionalandnationalandlocalSIscale
-0,2-0,1
00,10,20,30,40,5
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
scale_reg N=15
-0,4
-0,2
0
0,2
0,4
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
scale_nat N=24
Outcomeprofiles
SIMPACT–T5.1|93
Theaverageoutcomefactorscoresbythemeindicatethatit isdifficultforsocial
innovators in the themeof employment to generate economic benefits for their
ownorganisation (in termsof increased financial sustainability, increased reve-
nues, increasedmanagement/business capabilities, and increased employment),
butonaveragetheeconomicimpactonthetargetgroupishigherthanforSIsfrom
theotherthemes(Figure22).ForSIinthethemeofdemographicstheaverageeco-
nomic impact for the targetgroup is ratedrelatively low,butonehas tobear in
mindthatwhenthemarginalisedtargetgroupconsistsforinstanceofyoungchil-
drenorelderly,outcomesintermsofincreasedemploymentorworkskillsareless
applicable.Socialinnovatorswithinnovationsinthefieldofmigrationarestrug-
glingandcharacteristicistheonaveragelowincreaseinmanagementandbusiness
capabilitiesandnetworksfortheinnovatorsasanoutcomeoftheinnovation.
Figure22 Outcomeprofilebytheme,mainfunder,typeofSI,andSIwithverypositivelong-termperspective
-0,3-0,2-0,1
00,10,2
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
scale_local N=36
-0,10
0,10,20,30,40,50,6
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Employment N=35
-1,5-1
-0,50
0,51
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Demographics N=14
-0,8-0,6-0,4-0,2
00,20,4
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Migration N=11
-0,4-0,3-0,2-0,1
00,10,20,3
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Education N=19
94|SIMPACT–T5.1
WhenwecomparetheoutcomeprofilesbytypeofSIwenoticethegoodperfor-
manceofSIswhichaddressanewtargetgroup,excepttheverypoorreportedeco-
nomic andbusiness outcomes for the innovators themselves. Given the average
goodperformanceontheotheroutcomespolicymakerscouldsupportsocialinno-
vatorswiththisapparentlyriskykindofinnovation,e.g.withenhancingtheirman-
agementandbusinesscapacities.Aproduct/serviceinnovationislessriskyforso-
cialinnovators,sincetherewardsintermsofeconomicoutcomesfortheinnova-
torsareonaveragefortheproductinnovatorsfarabovetheaverageofallinnova-
tors.Wehavetonotethatrespondentscouldindicatemultipletypesofinnovations,
butwhentheSIconcernsanewproductorservice(in37cases)theeconomicout-
comesfortheinnovatorareonaveragehigh,butthescoreontheotheroutcomes
arerelativelypoor,exceptontheoutcomefactor ‘Physicalcapability’whichalso
includesimprovedlife-skills.
Adifferencebymaintypeoffundercanbeobservedbetweenthelocalgovernment
andstategovernment,inthesensethatintheoutcomesoftheSIsfundedbythe
lattershowhighscoresonthe factor ‘Economytargetgroup’,and lowscoreson
‘Socialfortargetgroup’.Ontheotherhand,theSIswhicharemainlyfundedbythe
localgovernmentshowlowaveragescoresoneconomicimprovementsforthetar-
getgroup,andhighimpactratingsonsocialimpactforthetargetgroup.Boththese
twoversionsofthegovernmentasmainfunderhaveincommonthattheaverage
SIoutcomesintermsofbenefitstothepublicbudgetandimprovedphysicalcapa-
bilitiesandlife-skillsforthetargetgroup,areaboveaverage.
-0,4-0,2
00,20,4
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Stategovernment N=14
-0,6-0,4-0,2
00,20,4
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Localgovernment N=5
-0,2-0,1
00,10,2
Economy innovator
Economy Target group
Social for target group
Physical capabilities
Public budget
typeSI_prod N=37
-0,5-0,3-0,10,10,30,5
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Very positive LT outlook SI N=32
OutcomeprofilesbytypeofSI
SIMPACT–T5.1|95
AverypositivelongtermoutlookofSIsseemsassociatedwithgoodscoresonall
theoutcomefactors,butespeciallyonthebusinesseconomicoutcomeforthesocial
innovatorsthemselves.
7.4 IndicatorApplicationinfullSIProfilesatMicroLevel
Inthissectionwepresenttheresultsofthefactoranalysisonallthemainvariables
includinginputs,objectives,obstacles,andoutcomes.Itresultsin5factors(Table
23):thefirst is ‘Economicfor innovator’whichconsistsofhighloadingsforeco-
nomicoutcomesforthesocialinnovator,includingimpactonfinancialsustainabil-
ity,revenues,businesscapabilities,networks,employmentandmarketingcapabil-
itiesoftheinnovator.
ThelabelgiventothesecondSIcomponentis‘Economicfortargetgroup’,andis
basedoneconomicoutcomesforthemarginalisedtargetgroupintermsofemploy-
ment,income,workskills,andtherelatedobjective(obj_ec_cap_target).
Factor3 ‘F&SCapitaldependency’standsfordependencyonfinancialandsocial
capital.Thislabelrelatesfirstofalltohighfinancialobstaclesandhighsocialob-
stacles,butalsotorelativehighimportanceoffunding(imp_res_cap),butalsoICT
andrelationalcapitalasaresource.Factor4iswehavelabelled‘Hybridwithvol-
unteers’.Thecombinationoforganisationalandlegalobstaclesisinterpretedasan
indicationfor‘hybridissues’inrelationtofindingaproperlegalformoforganisa-
tion.TheimportanceoflabourasaninputforSIoftenreferstounpaidwork.
Factor5unitessomesocialaspectswithanegativeloadingforoutcomesonlife-
skills of the marginalised (outc_lifeskills), other civic outcomes or benefits
(outc_civic_other), improved physical capabilities of the target group
(outc_phys_cap),andfortherelatedobjectivetoincreasethepersonal&socialca-
pabilitiesofthetargetgroup(obj_soc_cap_target).Onthecontrary,theobstacleof
competition is relativelyhigh in this factor.Besidesbeingan indicator fora low
orientationoftheSItowardssocialimpact,thecompositionofthisfactorsuggests
thatforSIswhicharelessorientedtowardssocialimpact,thereismorecompeti-
tionfromotherSIs.
Table23. FivecomponentsofSI;patternmatrixoffactoranalysis
FIVECOMPONENTSOFSI
1Economicforinnovator
2Economicfortargetgroup
3F&SCapitalde-
pendency
4Hybridwithvolunteers
5Lowonsocial,competingSI
outc_SI_stability .860 outc_SI_rev .832
outc_SI_bus_cap .805
Economicoutcomesforinnovator
Economicoutcomesfortargetgroup
Dependencyonfi-nancial&socialcapi-tal
Socialaspects
96|SIMPACT–T5.1
FIVECOMPONENTSOFSI
1Economicforinnovator
2Economicfortargetgroup
3F&SCapitalde-
pendency
4Hybridwithvolunteers
5Lowonsocial,competingSI
outc_SI_netw .758 outc_SI_empl .754
outc_SI_mark_cap .712 outcome_privateother .671 obl_bus .601
innercore .402 supporters .400
outc_employment .869 outc_impr_income .820
obj_ec_cap_target .802 outc_workskills .778
act_diversity -.508 .405 imp_obs_fin .683 imp_obs_soc .598
imp_res_cap .371 .560 imp_res_ICT .544
imp_res_rel_cap .512 imp_obs_tech .441
imp_res_soc_cap .415 imp_obs_org .806 imp_obs_legal .679 .428
Imp_res_labour .550
imp_obs_political .541
outc_self_conf .479 -.402
outc_SI_pub_budg .468
outc_network .378 outc_lifeskills -.755
outc_civic_other -.598
imp_obs_mark_share .387 .564
obj_soc_cap_target -.554
outc_phys_cap -.537
imp_res_experts -.399
KB_int
Note:ExtractionMethod:PrincipalComponentAnalysis.RotationMethod:ObliminwithKaiserNormalisation.Rotationconvergedin27iterations.Highfactorloadingsemphasisedinbold,below0.3suppressed.Totalvarianceexplainedby5factors=51.1%
ComparingthefullSIprofileforSIsimplementedatlocalscalewiththoseofinno-
vationsimplementedatthenationallevel(Figure23)showsthatforthelocalscale
thefactors‘Economicforinnovator’,‘Hybridwithvolunteers’,and‘Lowonsocial,
competingSI’arebelowaverage.Onthecontrary,atnationalscaletheSIsarelow
on‘Economicfortargetgroup’;‘Lowonsocial’andhighoneconomicsfortheinno-
vator.
EconomicoutcomesofSIimplementedatlocalvsnationallevel
SIMPACT–T5.1|97
WithregardstoSIinthethematicfieldsofgenderandmigration,wehavetobear
inmindthattheprofilesarebasedontheaverageofalowernumberofcases.How-
ever,wecanseethattheSIprofilesforthesethemeshaveincommonthattheyare
bothnot‘lowonsocial’,butpooron‘economicforinnovator’.Forthoseinthemi-
grationtheme,wenoticeahighaveragefactorscorefor‘Financialandsocialcapital
dependency’,and‘Hybridwithvolunteers’.ForSIinthethemeofgender,economic
benefitsforthetargetgroupseemtobeaboveaverage.
Figure23. SIprofilebyscaleofimplementationandthemeofSI
In20casestudiestheSIconcernedanewtargetgroup(typeSI_newgroup),in19
casesthetypeofinnovationhasbeenidentifiedas:‘Newinput(expertise,ICT,de-
sign-skills,material,etc.)’.Forthenewtargetgroupsasaninnovationtypeweno-
ticetheaboveaveragescoreonthefactors:‘Hybridwithvolunteers’,and‘F&Scap-
italdependency’,but lowscoreson ‘economic for innovator’and ‘Lowonsocial,
competingSI’.‘Newinputs’astypeofinnovationseemsassociatedwith‘F&Scapital
dependency’,and‘lowonsocial’,thatis:relativelowimprovementsoflife-skillsas
anoutcomeforthemarginalised.AverypositivelongtermoutlookonSIsisbased
ontwocharacteristics.Oneisthishighlysocialimpactfieldssuchaslife-skills(the
lowscoreon ‘Lowonsocial,competingSI’), forwhichthereseemstobe limited
competitionfromotherSIs.Thesecondcharacteristicis:‘Economicforinnovator’.
The8caseswithanegativelongtermoutlookindeedhaveabelowaveragescore
on ‘Economic for innovator’, andhigher scores for ‘Lowonsocial, competingSI’
(Figure24).
-0,3-0,2-0,1
00,10,2
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
scale_nat N=24
-0,3-0,2-0,1
00,1
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
scale_local N=36
-0,3-0,2-0,1
00,10,20,30,4
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
Gender N=9
-0,8-0,6-0,4-0,2
00,20,40,6
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
Migration N=11
98|SIMPACT–T5.1
Figure24. SIprofilesbytypeofSI,andlong-termoutlook,basedonaveragefactorscores
-0,3-0,2-0,1
00,10,20,3
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
typeSI_newgroup N=20
-0,3-0,2-0,1
00,10,20,30,4
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
typeSI_input N=19
-0,4-0,2
00,20,40,6
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
Very positive LT outlook SI N=32
-2-1,5-1
-0,50
0,5
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
Negative LT outlook SI N=8
SIMPACT–T5.1|99
8 INDICATORBASEDPROFILINGOFSOCIALINNOVATIONATTHELEVELOFEUROPEANREGIONS
8.1 RegionalData
AsdiscussedearlierintheSIMPACTproject,andaswitnessedbyotherliterature
(Hubrich,2012;andKrlev,Bund&Mildenberger,2014),themeasurementofSIis
allbutastraightforwardexercise.Inseveralincrementalstepswehaveconstructed
anexpandedblueprintforthemeasurementoftheeconomy-wide“macro”dimen-
sionsofSI(seeAnnex).InthisblueprintwetriedtoincorporateboththeSIpoten-
tialsandneeds,asamirrorfortheeconomicprinciplesofsupplyanddemand(and
inputandoutput),aswellascoveringtangibleandmoreimportantlyintangibleas-
setswhichcouldbesuchpotentialsandneeds.Duringthistheorydrivenprocess,
therecomesamomentthatonealsohastotakeapracticalapproachbydeparting
fromtheexplorationofexistingdatasources,sinceitwilltakemanymoreyears
beforestatisticalofficeswillproducestandardiseddataonSIfromEuropeansur-
veys.Departing fromexistingdatawecould first take in thepossible traditional
economicactivitymetrics.Althoughnotalloftheearlierexploredmetricsareob-
tainableat thispoint in time,wehave tried to findalternatives tosubstitute for
theseearliermetrics.
Inourpracticalexplorationofmacro-dataandsubsequentanalysiswetrytohigh-
lightmetricswhichsignify “usevalue”orat least includesome indicatorswhich
havea“usevalue”component.Thisvaluecomponentineconomicactivitiesisless
easilymeasurable,at leastnotinthetraditionalway.Ethical,environmental,hu-
manrights,communityandsocietalbenefitsarealllesseasilyvisibleandmeasur-
able as they concern non-financial and non-physical resources but they are the
maincontributorstohumanwelfareorbetter-saidwell-being.But,evenifthisuse
valueisnotdirectlyvisibletherearestilldataandinformationthatcouldbegath-
eredonimportant“Usevalue”componentssuchas:
• trustingovernment,institutions,policies,thirdsectorinitiativesand
communityactions(Nicholls2009)
• interestin,andrecognitionof,theneedsofmarginalisedcommunities
• capacitiesto,resolveproblems,addressneedsandconflictinginterests,
andactonemergingconflicts
• participationincommoncauses,workingforthecommongood
SIpotential&needs
Usevalue&valuecomponent
100|SIMPACT–T5.1
Toalargeextend,thesecomponentscanalsobereferredtoasSIprocess-indica-
tors.Trustandqualityofgovernanceareexamples,asmetricsontheseissuescan
serveasSIinput,SIoutput,aswellasSIprocessindicators.
TheinclusionofmetricsfromsurveyssuchastheonefeedingtheOECDBetterLife
Index26,ortheEuropeanSocialSurvey27couldprovidesuchviablealternativemet-
rics.Inaddition,moregenericeconomicorientedmetricscanbeadaptedandinter-
pretedforuseina“landscaping”todiscoverthepotentialandpropensitytoSocially
InnovateintheEU.Thislandscapecanconsistofeconomic,ormoresociallyorien-
tated,macroindicatorsassuggestedbytheTEPSIEproject(Hubrich,2012)anda
followuppaperbyKrlev,Bund,andMildenberger(2014).Manyhavefocusedon
nationalindicators,butatthesametimeallemphasisetheimportanceofthelocal
contextconcerningSI.Workingwithregionaldatawouldthereforemeanaconsid-
erableimprovementwithrespecttomeasurementatthemacrolevel.Wefindthat
thereisamplescopetoincludemoreregionalindicators,ofwhichsomeonNUTS3
level. In addition, the inclusion ofmore contextual, qualitative and quantitative,
dataisanoptionthroughuseofsourcessuchastheearliermentionedOECDand
Europeansurveysandadeeper interpretationofthedataprovidedbystandard,
buthighlyrelevant,sourcessuchastheEUStatisticsonIncomeandLivingCondi-
tions(SILC)andtheEULabourForceSurvey(LFS).
8.2 ExplorativeMethodology:CategorisationofEURegionsonSIComponentsbyPCA
InordertoidentifythemaintypesofSIeco-systemsatregionallevel,multi-variate
methods of data-reduction (principal component or factor-analysis, and cluster-
analysis)areveryappropriatetoidentifypatternsintheSImetrics,whichcanbe
used to make a typology of SI systems at regional level. As explained in the
OECD/JRC Handbook on constructing composite indicators (Nardo & Saisana
2005)PrincipleComponentAnalysis(PCA)andFactoranalysisareusefulincon-
structingcompositeindicators.Theyrefertoapplicationfortraditional,technolog-
icalandbusinessinnovation,explainingthat,sincetherearemanypotentiallyrel-
evantindicatorsconcerningknowledge,innovation,economyandsociety,thereis
aneedfordatareductiontechniques.Thesestatisticalmethodsidentifythestatis-
ticalrelationsbetweenthevariousindividualindicatorsandbasedonthatprovide
themainfactorsorcomponents.Thesamemethodologyisusedintheliterature
discussedintheprevioussectionansweringthequestion‘howfirmsinnovate?’,by
identifyingdifferentmodesofinnovationatfirmlevel.Thisexplorativemethodol-
26SeeOECD:http://www.oecdbetterlifeindex.org/
27SeeNorwegianSocialScienceDataServices(NSD)and:http://www.europeansocialsurvey.org/
Inclusionofsurveydata
PatternsinSImetrics
SIMPACT–T5.1|101
ogycanalsobeusedatthesystemslevel,foridentifyingdifferentmodesofinnova-
tionatsystemslevel(Wintjes2016).Asexamplesofapplyingthemethodoffactor
analysis for identifyingtypesofnational/regional innovationsystems inEurope,
werefertoDunnewijketal.(2008),Wintjes&Hollanders(2010),andWintjes&
Hollanders(2011).Forinstance,afterapplyingatwo-stepfactor-analysis,Wintjes
& Hollanders (2011) use a cluster-analysis to come to the main types (or
modes/models)ofregionalinnovationsystems.Forthesameargumentsasputfor-
wardintheaboveliterature,thesemethodsarealsoappropriatetocategoriseEU
regionsoncomponentsofSI.
Usingtheexpandedblueprintandthetheoreticalandpracticalconsiderationsas
detailedabove,wesetaboutcollectingdatafromanumberofresources.Datahas,
amongstothers,been taken fromDAFNE(DonorsandFoundationsNetworks in
Europe),theWorldGivingIndex,OECDHow’sLife:MeasuringWell-being,TheEu-
ropeanSocialSurvey,theEURegionalInnovationMonitorsurvey,andfromEURO-
STAT’sregionaldata.
InthebelowTable24weshowasampleofthemetrics,orvariables,retrieved.For
instance,variables1and2areapracticalexampleof the “usevalue”metricsor
componentswhichwementionedinthesecondparagraphofthischapter.
Table24. Sampleofvariablesinthedatabase
VariablePotential/
NeedTangible/Intangible Source
1 TrustintheEuropeanParliament Need Intangible ESS
2 Trustinthelegalsystem Need Intangible ESS
3 Employeeswhoareinvolvedinlife-longlearn-ing
Potential Intangible Eurostat
4 Studentsleavingcompulsoryeducation Need Tangible Eurostat
5 Earlyleaversfromeducationandtraining Need Tangible Eurostat
6 Sizeofpublicsector:Employment Potential Tangible Eurostat
7 Sizeofpublicsector:Governmentexpenseonoperatingactivitiesandservices
Potential Tangible WorldBank
8 Helpingorattendinglocalareaactivities Potential Intangible ESS
9 WorldGivingIndex Potential Intangible WGI
10 Safetyasapartofwell-being Need Intangible OECD
Withthesemetricswetrytocapturethetrustrelatedlandscape.Theseareintan-
gibleassetsastheynon-physical,non-monetary,“goods”whicharenon-the-lessan
integralpartofSI intheEU.Variablethreeisagoodexampleofanindicationof
potential,oraninput-indicator.Herewemeasurethenumberofemployeeswho
areengagedinlife-longlearning,aftertheirformaleducationcareer.Anincreasein
102|SIMPACT–T5.1
knowledgeduringlifeisaclearpotentialforinnovationanditisthislastpart(ac-
tuallyan intangibleasset) thatwearemeasuring.Wealsousesimilarvariables,
suchas4and5,whichcanbeusedascontrols.Thesevariablesshouldhaveasimi-
larvalueintheanalysisalthoughtheymightbepresentindifferentfactorsdepend-
ingonthecontext.Somesubjectsaremadeupofdifferentcomponentswhichare
interestingtotestseparately.Onesuchsubjectisthesizeofthepublicsector,where
sizecouldbeitsworkforceoritcouldbethefinancialassetsdeployed.Variables6
and7covertheseaspects.Othermoredifficulttomeasurevariablesaretheones
focusingonthephilanthropicnatureofpeopleandsociety.Theinclinationforpeo-
pletohelpothersordonatemoneycanneverthelessbecapturedasisshownby
variables9and10.Finallyanumberofvariablesareincludedwhichmeasurethe
importancethatpeopleattributetocertainaspectsinlife,suchasadequatehous-
ing,havingajobetc.Variable10‘Safetyasapartofwell-being’isanexampleofthis
(Table24).
Insumwehaveretrieved265SIrelatedmetricsandanadditional5metrics for
comparisonandcontrolpurposes.Ofthese271metrics8areavailableatthena-
tionallevelonly.Thisavailabilityofdataatregionalleveliscontrasttowhatprevi-
ousresearchhasmentioned.TheremainingdataisthenonNUTS1andNUTS2level.
WehaveusedtheexistingdatatoextrapolatetotheNUTS2levelinordertohave
sufficientcoverageforallvariables.Indoingsoweendedupwithadatabaseof360
regions(NUTS0-2)and271variables.
Somemayclaimthatwehaveusedatoobroadsetofindicators.Othersmightques-
tionwhywehavenotincludedindicatorsonenvironmentalissues,healthorsecu-
rity.GiventheSIthemesofSIMPACT,itisquiteabroadsetofindicators,butsince
thiskindofempiricalexercisehasnotbeendonebefore,itisbettertostartwitha
broadset,andnarrowitdowninthecourseoftime.Moreover,somemaywantto
steertheindicatorsettowardsaspecificthemeofSI,withinthisset.
Insuchalargedatabase,thereareofcourseafewissues,whichcanobstructthe
statisticalanalysesofthedata.Thetwomostimportantproblemsinthisrespect
aremissingvaluesandlargedifferencesinscalingofthevariables.Inordertoover-
cometheseproblems,wehavefirstimputedthemissingvalueswithameanvalue
correspondingtothemeanoftheseries.Next,wehavestandardised,ornormalised,
thevaluesforeachofthedataseriestoobtainnormaldistributions(z-scores)ready
forfurthercalculation.Thesearebothnormalprocedures,whichgenericsoftware
packagessuchasSTATAandSPSScanperform.
Duetolargesizeofthedatabase,thereisaneedtoreducethedatawithoutlosing
toomuchof the information themetrics themselvescontain.Thiswehavedone
usingaPrincipalComponentsAnalysis(seethenextsection).Becauseweassume
265SImetricsplus5comparison/
controlmetrics
Obstaclesassociatedtolargedatasets
SIMPACT–T5.1|103
thatallthevariablesarecorrelatedweuseanobliquerotationmethod(Oblimin
withKaiserNormalisation).
Inanextstep,withthefactorsretrievedfromthePCAwehavedonetworegres-
sionsinordertotesttheimpactoftheresultingSIfactorsorcomponents,namely
theimpactonregionalGDPandinanotherregressiontheimpactonamoreholistic,
intangibleandsocialoutputindicatorwhichlooks‘beyondGDP’,namelyaRegional
HumanDevelopmentIndex.WehavetriedtoanalysehowourSImetricsrelateto
this regional index of socio-economic development. In a second comparisonwe
haveusedregionalGDPpercapitadatatorelatetheSImetricstoregionalincome
orproductivityas themore tangibleeconomicoutcome. In thiswaywehope to
captureboththeeconomicandsocialrelevanceofSIaswitnessedbythecollected
data.
8.3 ResultsoftheFactorAnalysis
Table25showsthepatternmatrixofthefactoranalysis.Inthismatrixwefindthe
solutionofthePCAasdescribedabove.Thereisacleardistinctionnoticeableinthe
divisionofthevariablesandtheirweightingsoverthe5components.Inthetable
youcanseethevariablesrankedaccordingtothelargestvaluestartingcomponent
1andwithlesssignificantvalues,withaweightbelow0.30suppressed.
Table25. Factoranalysisonregionalindicators:fiveSIcomponents,patternmatrix
1Governancevs.Civil
2Unemploy-
ment
3TrustinState&Newideas
4Failing
Education
5Engage-ment
Helpingastranger -0.899 0.33WorldGivingIndex -0.839
Citizensaretreatedequallyinpubliceducation
0.823
Corruptionpersistsinlawenforce-ment
0.733
Othercitizensusebriberytoobtainpublicservices
0.713
QualityofGovernmentindex 0.688
Shareofparttimeemploymentintotalemployment
0.669
Housingasapartofwell-being 0.646
Qualityoflawenforcement 0.636
Mostpeoplecanbetrusted 0.579
Corruptionpersistsinregionalelec-tions
0.572 0.323
Environmentasapartofwell-being 0.554 0.429
Qualityofpubliceducation 0.503
Shareofinnovatorscooperatingwithothers
0.482 0.344
104|SIMPACT–T5.1
1Governancevs.Civil
2Unemploy-
ment
3TrustinState&Newideas
4Failing
Education
5Engage-ment
Femaleeducationalattainment:Ter-tiaryeducation
0.474 0.332
Mostpeopletreatyoufair 0.456
Structuralfundsallocationsoninnova-tion
-0.409
Independence/AutonomyonRTDI 0.404
Incomeasapartofwell-being 0.402 0.324
Maleeducationalattainment:Tertiaryeducation
0.398
Safetyasapartofwell-being 0.361
Youthunemployment 0.866
Totalunemployment 0.865 Femaleunemployment 0.859
Employeeswhoareinvolvedinlife-longlearning
0.850
Estimatedtotalinternationalimmigra-tion
0.842
Futureinternationalmigration:Extrap-olationfor2020-2030
0.807
Sizeofpublicsector:Employment 0.527 -0.464
Studentsleavingcompulsoryeduca-tionwithoutadiploma
0.508
Regionalpopulationdensity 0.317
Trustinthepolice 0.866
Itisimportanttothinknewideasandbecreative
0.864
Itisimportantthatgovernmentisstrong
0.829
TrustintheEuropeanParliament 0.818 0.330 Trustinthelegalsystem 0.815
Itisimportanttotrynewanddifferentthings
0.813
Trustinpoliticians 0.348 0.693 Feelingpeopleinlocalareahelpeachother
0.643
Helpingorattendinglocalareaactivi-ties
-0.344 0.573
Feelingclosetopeopleinlocalarea 0.447
Independence/Autonomyingeneral Educationasapartofwell-being -0.896
Educationalattainment:Lessthanpri-maryandlowersecondary
0.887
Earlyleaversfromeducationandtraining
0.764
Jobsasapartofwell-being 0.315 -0.676
Longtermunemployment 0.634 Self-employedpersonsasparttotalemployment
0.614
Peopleatriskofpoverty 0.579 -0.383
Accessibilitytoservices 0.506 -0.563
SIMPACT–T5.1|105
1Governancevs.Civil
2Unemploy-
ment
3TrustinState&Newideas
4Failing
Education
5Engage-ment
Peopleatriskofpovertyorsocialex-clusion
0.502 -0.388
Infrastructureaspartofwell-being -0.492 0.301
Internetaccess 0.398 -0.428
Netmigrationplusadjustment 0.302 -0.411
Annualexpenditureofthemunicipalauthorityperresident
-0.358
Sizeofphilanthropicsector:Numberoforganisations
0.347 -0.369 -0.686
Civicengagementaspartofwell-being 0.663
Shareofinnovatorsreceivingpublicfi-nancialsupport
0.588
Sizeofpublicsector:Governmentex-penseonoperatingactivitiesandser-vices
0.339 0.571
Shareofcompaniesthatintroducedaserviceinnovation
0.523
Businesssophistication 0.44 -0.371 0.493
Percapitanumberofsmallfirms 0.464
Healthasapartofwell-being 0.371 0.341 0.422
Shareforeignersintheregionalpopu-lation
0.422
ExtractionMethod:PrincipalComponentAnalysis.RotationMethod:ObliminwithKaiserNormalization.
a.Rotationconvergedin17iterations.
Inthefirstregionalfactor,whichwehavelabelled‘Governancevs.Civil’weseehigh
loadings(negative) for ‘helpingastranger’andtheWorldGivingIndex, together
withhighloadingsformanygovernanceissues,e.g.:‘citizensaretreatedequallyin
publiceducation’. Since factoranalysis canbeseenasa impressionisticmethod,
there is roomforvarious interpretationsof thedifferent factorsorcomponents.
Withamorecynicalviewwecouldsaythatinfactoroneweseepeopleenjoyinga
highqualityoflife;well-educatedandwithagoodjob,enjoyinggoodservicesina
safeenvironment,butatthesametimenotveryopentogivingandhelpingothers
inneed.Perhapsanexponentofanincreasingindividualisticsociety?
Wewillgiveroomforfurtherinterpretationsbyprovidingamapshowingwhich
regionshaveahighscoreonthisregionalSIcomponentwhichwehave labelled
‘Governancevs.civil’(Figure25).
106|SIMPACT–T5.1
Figure25. Regionalscoreon‘Governancevs.civil’ Figure26. Regionalscoreson‘Unemployment’
Factortwoissimplylabelled‘Unemployment’,butitisnotassimpleasthat,since
italsoincludesLife-Long-Learning(LLL),immigration,andforinstancesizeofthe
publicsectorintermsofemployment.Wedonotethattheregionaldataonthese
issuesreferstothesituationofseveralyearsago.Themap(Figure26Fehler!Ver-weisquellekonntenichtgefundenwerden.)showsthatthisSIcomponentisge-ographicallyveryfragmentedacrossEurope.Ofcourse,thereisquitesomeregional
variationwithinthiscomponent,e.g.amongthetop-10highscoresonthisSIFactor
2‘Unemployment’thescoresofSpanishregionssuchasMadrid,AndaluciaandBar-
celonaaretoalargeextentbasedonhighunemploymentrates,buttheveryhigh
scoresonthisfactorformanyotherregionsinthistop-10(e.g.:forLombardia,Lon-
donandBerlin)arebasedtoalargeextentonothervariableswithhighloadings
withinthisfactor(suchasLLL,immigration,publicsector,andpopulationdensity).
Factorthreerevolvesaroundtrust,newideas,andcohesion;importantintangible
socialmetrics.BasedonthefirstfewhighloadingswehavelabelledthisFactor3:
TrustintheState&newideas,butbesidestrustinthepolice,stronggovernment,
andnew ideas it for instancealso includeswithslightly lower loadings: ‘Feeling
peopleinlocalareahelpeachother’and‘Helpingorattendinglocalareaactivities’.
HighscoresonthisSIfactorcanbefoundinregionsofwestGermany,Spain,and
NorthernItaly(Figure27)Figure26.
Very low
No data available
High
Average
Low
Very highCypress
Crete
MaltaVery low
No data available
High
Average
Low
Very highCypress
Crete
Malta
Unemployment
Trust,newideas&cohesion
SIMPACT–T5.1|107
Figure27. Regionalscoreson‘TrustinState&newideas’ Figure28. Regionalscoreson‘Failingeducation’
Factor4wehavelabelled‘Failingeducation’,becauseitscoreshighonthefollowing
variables: ‘Educationasapartofwell-being’(negative), ‘Educationalattainment:
Lessthanprimaryandlowersecondary’,‘Earlyleaversfromeducationandtrain-
ing’,‘Jobsasapartofwell-being’(negative),and‘Longtermunemployment’.This
factoralsogoeswithahighrateofpeopleatriskofpovertyandlowlevelofacces-
sibilitytoservices.Highscoreonthisfactorcanforinstancebefoundinregionsin
Spain,southernItalyandGreece(Figure28).
Thefifthfactoriscalled:‘Engagement’because‘Civicengagementaspartofwell-
being’isveryhigh,butitisnotofthekindthatisrepresentedbythephilanthropic
sector. This factor also includes innovation policy and service innovation. High
scoresonthisfactorcanbefoundinforinstance:France,Belgium,Netherlands,and
Denmark(Fehler!Verweisquellekonntenichtgefundenwerden.).
8.4 ResultsoftheRegressionAnalyses:ImpactonGDPandbeyond
Inthissectionwepresenttheresultsoftheregressionsandacomparisonthereof.
Asdiscussedearlierwecollectedover270macrovariables,whichhaveabearing
onSI.However,suchalargenumberofdata,withdifferentproperties,presenta
challengewhen it comes to interpretation.A statisticalway to solve these chal-
lengesistoreducethedatabyrescalingandsimplifying.Thegeneralmethodused
forthisisthroughaprincipalcomponentanalysis(PCA).InthisPCAwereducethe
Very low
No data available
High
Average
Low
Very highCypress
Crete
MaltaVery low
No data available
High
Average
Low
Very highCypress
Crete
Malta
Failingeducation
Engagement
108|SIMPACT–T5.1
datawehaveon265variablesto5factors. Theremainingvariablesareusedasdependentvariablesfortheregressions.
Wehavefirstresolvedtheissuesofmissingvaluesbysubstitutingthesewiththe
appropriatemean.Next,wehavestandardisedthevaluesasthedatahasdifferent
scalingandproperties,whichneedtobealignedsoastopreventanyskewnessin
theoutcomes.
Inthebelowscreeplot(Figure29)wecanobservetheeigenvaluecurve,wherethe
“elbow”ofthecurveappearsatabout5components.Wethereforeusethisnumber
forourregression.
Figure29. Screeplotwitheigenvaluecurve
AftertherequireddatamanipulationandPCA
weareinterestedindiscoveringwhetherour
dataisindeedfitforacomparisonbychecking
whether the expected cumulativeprobability
ofthestandardisedvalues(Z-scores)followsa,
near,equalpathastheobservedZ-scores.This
wedousingaP-Pplot.
WehaveselectedtheRegionalHumanDevelopment IndexvariablesandtheRe-
gionalGDPvariablesasourdependentvariablesandbelowweshowtheP-Pplots
forboth(Figure30).
Figure30. P-PplotsforRegionalHumanDevelopmentIndexandRegionalGDPpercapita
Inbothplotsthecurvesfollowasufficientlylinearpathforustobeabletostate
thatthereisanormaldistribution.Ofcourse,weneedtotakeintoaccountthelarge
numberofvariablesandthevarianceinthetypesofvariableswearedealingwith
inthisexerciseasstatedbefore.
SIMPACT–T5.1|109
Onthefollowingtwopagesacomparisonismadeofthe5factors,withontheleft
theRegionalHumanDevelopmentIndex(RegionalHDI)asthedependentvariable,
andontherighttheRegionalGDPasadependentvariable.
Figure31. RegressionsforregionalSIFactor1:‘Governancevs.Civil’withRegionalHDI(left)andGDP(right)asdependentvariables
TheregionalSIfactor1:‘Governancevs.Civil’ispositivelyrelatedtobothregional
HDIaswellasGDPpercapita,sothisSIcomponentindeedseemstoimpactGDP,
andbeyond(Figure31).ThepolicylessonofthisSIfactorisnotthatweshouldstop
helpingstrangers,butthatqualityofgovernanceofoursocietiesmatter,andthat
SIcanbemorethatthe‘feelgood’factorofhelpingstrangers.
Figure32. RegressionsforregionalSIFactor2:‘Unemployment’withRegionalHDI(left)andGDP(right)asde-pendentvariables
TheregionalSIFactor2(‘Unemployment’)withhighloadingsforunemployment
couldbeseenasanindicatorforSIneeds.However,wecouldinterpretthelackof
anegativeimpactonthechosenoutputindicators(Figure32),asanindicationthat
SIcomponentim-pactsGDPandbe-yond(HDI)
Unemploymentasin-dicatorforSIneeds
110|SIMPACT–T5.1
alsotheSIsolutionsareincludedinthesamefactor:e.g. theinvolvementin life-
long-learning,whichisalsopartofthisfactor.Thisfurthersuggeststhathiddenin
thisfactorareSIswithsimilarcharacteristicsandimpacts:‘Life-long-learning’kind
ofSIs,whichcanbefoundundermanySIthemes,butespecially:thethemesofem-
ploymentandeducation.
RegardingtheregionalSIFactor3(‘TrustinState&newideas’)wecanconclude
thatthereseemstobenorelationwitheitheroneoftheoutputindicators(HDIand
GDPpercapita)(Figure33).Basedoneachoftheseparateelementsofthisregional
SIcomponentonewouldratherexpectthisfactortohaveapositiveimpact.Wedo
notseemanysocialneedsconcentratedinthisfactor,butratherelementsofpoten-
tial, e.g.: people trust the government; they see the importance of thinkingnew
ideas;andtheyfeelpeopleinlocalareahelpeachother.Perhapsthisfactorrelies
toomuchonnewideasforSImanagedorpromotedbytheState,andassuchcould
beseenasanunder-usedpotentialforSIinitiatedatgrass-rootslevel,oranimated
incooperationwithaless‘strong’government,inaless‘top-down’modeofinter-
actionandSIpolicy.
Figure33. RegressionsforregionalSIFactor3:‘TrustinState&newideas’withRegionalHDI(left)andGDP(right)asdependentvariables
ConcerningtheFactor4‘Failingeducation’thereisanegativerelationwithboth
outputindicators(Figure34).Besidesbetterandmoreeducation,thecomposition
ofthisfactorsuggeststopolicymakersthatalsoaddressinglabourmarketissues,
increasingaccesstoservicesandinfrastructure,andincreasingaccesstointernet
arepotentialremediesandSIthemestobetteraddresstheSIneedsassociatedwith
‘Failingeducation’.
TrustinState&newideasdonotimpact
HDI&GDP
Failingeducationnegativelyaffects
HDI&GDP
SIMPACT–T5.1|111
Figure34. RegressionsforregionalSIFactor4:‘FailingEducation’withRegionalHDI(left)andGDP(right)asde-pendentvariables
WeconcludethatespeciallytheregionalSIfactors1:‘Governancevs.Civil’and5:
‘Engagement’arepositivelyrelatedtobothHDIaswellasGDPpercapita.Factor2
(‘unemployment’)andFactor3(‘TrustinState&newideas’)donotseemtohave
animpactoneitheroneoftheseoutputindicators.The4thregionalSIfactor‘Failing
education’hasanegativeimpactonboththesetwooutputindicators.
Figure35. RegressionsforregionalSIFactor5:‘Engagement’withRegionalHDI(left)andGDP(right)asdepend-entvariables
8.5 ResultsofClusterAnalysis&ApplicationofRegionalSIProfiles
ThefinalstepinourmethodologyconsistsinclusteringthePCAfactors,andconse-
quentlytheEUNUTS2regions,into4clustersasfourtypesofSI-eco-systems.For
thisweusedthehierarchicalclusteringWardmethodwhichisaminimumvariance
methodfocusedonminimisingthewithinclustervarianceof thefactors.Ward's
minimumvariancecriterionminimises the totalwithinclustervariance.Ateach
112|SIMPACT–T5.1
stepoftheclustering,themethodmergespairsofclusterswithaminimumcluster
distance.Inotherwords:ateachstepthemethodsearchesforapairofclustersthat
leadstotheminimumincreaseintotalwithin-clustervarianceaftermerging.This
increaseisaweightedsquareddistancebetweenclustercentres,whichmustbea
squaredEuclideandistance.Theresultingclustersolutionandthecorresponding
classificationofregionsistranslatedintoamap(Figure36).
Figure36. FourtypesofSIregionsinEurope
We find thatCluster1,e.g. thegreencolouredregions,verymuchrepresent the
Mediterraneanregionaswellasthreelargeurbanregions;London,ParisandBrus-
sels,butalsoNord-Pas-de-Calais,andBratislava.ThesecondCluster(2)whichis
colouredorangerepresentsmuchofNord-westernEuropeaswellasAustria,parts
ofItalyandafewregionsinSpainandforinstancealsotheurbanregionofAthens,
andCyprus.ThethirdCluster(3)iscolouredcyanandexclusivelyEast-European
inmake-upanddoesnotincludeotherEuropeanregions.Finally,Clusternumber
4(yellow)ismade-upofthe“old”WestGermanregions.
Whenweaveragetheregionalfactor-scoresfortheregionsincluster1(thegreen
onesonthemap)wenoticethatthistypeofregionischaracterisedbyalowscore
onthefactor‘Governancevs.Civil’,butahighscoreon‘failingeducation’and‘un-
employment’(Figure37).
Cluster 2
Cluster 3
Cluster 4
Cluster 1Cypress
Crete
Malta
The4EuropeanSIregions
SIMPACT–T5.1|113
Theaveragefactor-scoresofthe133regionswhichareinCluster2(orange)indi-
catethatthistypeofSIregionhasonaveragehighscoresonthefactors‘Govern-
ancevs.Civil’and‘Engagement’,whilehavingbelowEUregionalaveragescoreson
thefactors‘Failingeducation’,and‘Unemployment’.Thecluster3typeofSIregions
canbecharacterisedbybelowaveragescoreon‘engagement’andlesshighaverage
scoresfor‘failingeducation’andunemploymentthantheaverageofcluster1.The
cluster4west-GermantypeofSIregionhasonaveragerelativelyhighscoreson
‘trustinStateandnewideas’.
Figure37. MacroSIprofilesforthefourtypesofSIregionsinEurope
TheregionalSIprofilescanalsobeusedtocomparethemacro-SIprofilesbetween
othergroupsofregionsorcountries.Wegivesomeexamples.
The35regions–forwhichwehaveaSIMPACTSIinourdatabasewithinthetheme
ofemployment–haveadifferentscoreoftheregionalSIfactorsthantheaverage
EUregion(Figure38).Especiallythefactor‘Unemployment’ismuchhigher,whichoffcoursemakesmuchsense.Theaverageregionalcharacteristicsofregionswhere
SIMPACTcasesofSIoriginateforthethemeof‘Demographics&Migration’arequitesimilar:withhigherlevelsof ‘Engagement’and‘Governancevs.civil’,andlowon
‘Failingeducation’. Interestingly,SIsinthefieldofeducationcanbefoundinre-
-0,5
0
0,5
1
1,5
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Cluster 1N = 56
-0,4-0,2
00,20,40,6
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Cluster 2N = 133
-1,4-1,2-1
-0,8-0,6-0,4-0,2
0
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Cluster 3N = 52
-1,5-1
-0,50
0,51
1,52
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Cluster 4N = 30
ComparisonofmacroSIprofiles
114|SIMPACT–T5.1
gionswithverylowscoreson‘failingeducation’,butwithhighscoreson ‘unem-
ployment’.TheregionalSIprofileofthecasesintheEmploymentthemeandthe
averageregionalSIprofileofthecasesinthethemeofeducationarequitesimilar.
AlsotheregionalSIprofilesofthecasesinthethemeofDemographicsandthosein
Migrationarequitesimilar.
Figure38. AveragemacroSIprofilesforselectedcasesbythemeofSI
Note: TheaveragefactorscoresforallEUregionsinthedatabaseiszero,asreflectedbythegreen-line.TheorangelinerepresentstheaveragefortheSIcaseswithaparticularthemeinaspecificregion.Thisorangelinethereforerepresentsasub-sampleaswedonothaveresultsforSIcasesineveryEUregion.
FromtheseregionalSIprofiles,wecanalsoconcludethatonaveragetheSIMPACT
casesofSIareselectedfromregionswhichhaveonaverageahigherrateofunem-
ployment than theaverageEUregion. Inaddition, the factorengagement seems
higherthantheEUregionalaverage.SIswithaverypositivelong-termoutlookare
especiallytobefoundinregions,withevenhigherscoresonthefactor‘Unemploy-
ment’,butalsoinregionswhichhavearelativehighscoreon‘Trustinstate&new
ideas’.Furthermore,theyhavealowscoreon‘Failingeducation’.
-0,50
0,51
1,52
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Employment N = 35
-1-0,5
00,51
1,5
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Migration N = 11
-1-0,5
00,51
1,5
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Demographics N = 14
-0,50
0,51
1,52
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Education N = 19
SIMPACT–T5.1|115
Figure39. MacroSIprofilesforselectedcasesbylong-termoutlookoftheSI
Note: TheaveragefactorscoresforallEUregionsinthedatabaseiszero,asreflectedbythegreen-line.TheorangelinerepresentstheaveragefortheSIcaseswithaparticularthemeinaspecificregion.
8.6 Micro-SI-ProfilesperTypeofregionalSIProfile
ThenumberofSIcasespertypeofregionarequitesmallforcluster4andcluster
3.Concerning themicro-profilesofSIper typeof regionwe therefore limitour-
selvestothecomparisonbetweenthetypeofCluster1(green)andCluster2type
ofregions(orange)(seeFigure40).
Figure40. MicroSIprofilepertypeofregion
Themicroprofilesshowmajordifferences.InCluster1thereareonaverageless
SIswhichare‘lowonsocial’,sotheirsocialrelevanceishigh.Alsointermsofeco-
nomicimpactforthetargetgrouptheirperformanceisonaveragehigher.InClus-
ter2,theSIshaveonaveragelowerratedeconomicbenefitsforthetargetgroup.
Thecasesintype2regionsoftenhavelowsocialimpactscoresonissuessuchas
life-skillsofthemarginalised(as indicatedbyahighscoreonthefactor ‘Lowon
social,competingSI’).
-0,50
0,51
1,52
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Very positive LT outlook SI N = 32
-0,8-0,6-0,4-0,2
00,20,40,6
Governance vs civil
Unemployment
Trust in state & new ideas
Failing education
Engagement
Positive LT outlook SI N = 13
-0,8-0,6-0,4-0,2
00,20,4
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
Cluster 1N = 18
-0,4-0,3-0,2-0,1
00,10,20,3
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
Cluster 2N = 21
116|SIMPACT–T5.1
InFigure41wepresentthemicroinputprofiles,andoutputprofilesoftheSIsin
bothcluster1andcluster2typeofregions.
Figure41. Microinput,output,andfullSIprofileforcasespertypeofregion
-0,4-0,2
00,20,40,6
Number of actor support
Diversity of knowledge
Social capitalICT & funding
Knowledge
Cluster 1Input factorsN = 18
-0,6-0,5-0,4-0,3-0,2-0,1
00,10,2
Number of actor support
Diversity of knowledge
Social capitalICT & funding
Knowledge
Cluster 2Input factorsN = 21
-0,10
0,10,20,30,40,5
Economy innovator
Economy Target group
Social for target group
Physical capabilities
Public budget
Cluster 1Outcome factorsN = 18
-0,4
-0,3
-0,2
-0,1
0
Economy innovator
Economy Target group
Social for target group
Physical capabilities
Public budget
Cluster 2Outcome factorsN = 21
-0,6-0,4-0,2
00,20,40,6
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
Cluster 1Very positive LT outlook SI N = 13
-0,6-0,4-0,2
00,20,40,6
Economic for innovator
Economic for target group
F&S Capital dependency
Hybrid with volunteers
Low on social competing SI
Cluster 2Very positive LT outlook SI N = 10
SIMPACT–T5.1|117
9 CONCLUSIONS
WeconcludethatSIhasmanyaspects,andisanevenbroadersocietalconceptthan
otherformsofinnovation,suchasthemoretraditionaltechnological,andfor-profit
innovations.Besidesaconceptualbroadening,alsothemetricsandmeasurement
approachesneedtoincorporateabroaderperspective,byspecificallyincludingthe
publicsector,thesocialorthirdsector,andtheprivatesector,sinceSIdealsabout
thenewcombinationsof resources and capabilities from these sectors.Abroad
rangeofresourcesandcapabilitiesofthesedifferentsectorsserveasinputtothe
SIs.Inaddition,theobjectives,andthebenefitsandimpactsfromtheSIsdifferfor
eachofthesethreesectors.MeasuringSIthereforeinvolvescapturingtheseaspects
forthevarioussectors.FormeasuringSIorthemeasurementofitseconomicim-
pacts,itisnotenoughtolimittheindicatorstoonlyoneortwoofthesethreeeco-
nomicsectors.
WecanconcludethatthevalueorimpactofSIsderivefromtheinteractionbetween
thesupplyanddemandforSIs.Therefore,indicatorsetsneedtoincludebothindi-
catorsforthedemand,orfortheneedsforSIs,aswellasindicatorsforthepotential
tosupplysolutions.Theinteractionbetweendedemandandsupply-sideofSIas
theeconomicunderpinningofSIisnotmediatedbypricesonmarketsforexchange
value.Aswithotherkindsofinnovationstheproducersandusersofinnovations
have to engage in interactive learning, which involves communicating tacit
knowledgeanddiscussionsofintangiblesandusevalueamongcollaboratingpart-
ners.
Regarding themeasurementofSIatmicro level it is relevant tocapturevarious
inputs,outputs,objectivesandobstacles.Theimportanceofcertaininputsdiffers
byforinstancethetypeofmainfunder,thethemeofSI,andthescaleofoperations.
SIsatlocalscalehaveonaveragealowernumberofactorsandcooperation,anda
lowerdegreeofdiversityofknowledge thanSIswhichoperateatnational level.
Thesetwoinput-factors(a largenumberofactorsandpartners,anddiversityof
knowledge)arealsocharacteristicfortheSIswhichhaveaverypositivelong-term
perspective.
ICTseemamoreimportantsourceofinputforSIinthetheme‘Demographicsand
Education’, than for SIs in the theme ‘Employment’. ICT investments seem also
morecommonamongSIswhichareimplementedatnationalscale(comparedto
thoseimplementedatlocalscale).Ontheotherhand,forSIinthetheme‘Employ-
ment’,knowledgeisarelativelyimportantinput.
Supply&demandforSIsdeterminevalue/impact
Measurementatmicrolevel
ICTasimportantinputforSI
118|SIMPACT–T5.1
ItisdifficultforinnovatorstocombineinoneSIthetwoobjectivesofseizingbusi-
nessopportunitiesandincreasingpublicvalueswhichdonotbenefitthemarginal-
isedtargetgroupdirectly(e.g.:socialcohesion,inclusion,lobbying).
The co-rated importance of organisational and legal obstacles confirms the im-
portanceofthehybridissueforsocialinnovatorsconcerningtheproblemtofind
theappropriatelegalformoforganisationfortheiractivities.
Theconcentrationofsocial,financialandpoliticalobstaclesforcertainSIsseemsto
serveasanidentificationofradicalSIs.
Severaltypesofeconomicoutputcanbeidentified:economicoutcomesforthein-
novator,economicoutcomesforthetargetgroup,andbenefitsintermsofpublic
budget.Othersocialbenefitscannotdirectly,betranslatedintoeconomicbenefits,
oritwouldtakeamuchlongertimetomaterialise.
SIswhichareimplementedatlocalscalehaveahigheconomicimpactforthetarget
groupandthepublicbudget,buttheimpactsfortheinnovatorarerelativelysmall
comparedtoSIswhichareimplementedatnationallevel.SIsimplementedatna-
tionalscalehaveonaveragelessimpactonpublicbudgetandlowerratedeconomic
impactsforthetargetgroup,butthebusinesseconomicimpactsfortheinnovators
areratedhigher.
SIs in the themeofEmploymentarecharacterisedbyonaveragehigheconomic
impactsforthetargetgroup.
SIsthatareproduct/serviceinnovationsdowellontheeconomicimpactsforthe
innovators.SIswhich involveaddressinganewtargetgroupdoverywellonall
impactfields,excepteconomicimpactsfortheinnovator.Inordertoimprovetheir
longtermperspective,policymakersshouldthereforeinvestinthebusinesscapa-
bilitiesofthesesocialinnovators(withoutapplyingfurtheroutputrelatedobjec-
tivesconcerningbenefitsforthemarginalisedtargetgroup).
SIsthathaveaverypositivelong-termperspective,haveaboveaveragescoreson
impactsfortheinnovator,butalsoforsocialaswellaseconomicbenefitsforthe
targetgroup.Themoregeneralpolicyimplicationisthatpolicymakers,whowant
to increase the long-term economic impact from social innovation, should not
merelyfocusonoutputintermsofempowermentofthemarginalisedtargetgroup,
butshouldalsoinvestintheempowermentandlong-termperspectiveofthesocial
innovators.
Diverseconomicoutcomes
LocalSIshowhigherimpactsfor
targetgroups
Product/serviceSIhavehighimpactsfor
innovators
Complementingim-pactsfromempow-eringinnovator&
targetgroups
SIMPACT–T5.1|119
BasedonalargesetofregionalstatisticswithrelevancetoSI,wecanconcludethat
theregionalsituationconcerningSIdifferswithinEurope,andnotalldifferences
canbereducedtodifferencesbetweencountries.
TheidentifiedregionalSIfactorsarebothrelatedtodifferencesinregionalGDPas
wellasregionalHumanDevelopmentIndex,anindexwhichcanbeseenasanout-
putindicatortomeasuretheimpactofSIbeyondGDP.
FourdifferenttypesofSIregions(orregionaleco-systems)withintheEUareiden-
tified.ThefirstgrouporclusterofregionswithsimilarSIcharacteristics,arechar-
acterisedbythehighscoreontheSIfactor,whichwehavelabelled‘Failingeduca-
tion’.ThesecondgroupofregionsarecharacterisedbyhighscoresontheSIfac-
tors:‘Governancevs.civil’,and‘Engagement’.
TheSIMPACTcasesinthefirsttypeofregiondowelloneconomicimpactforthe
targetgroup.TheSIMPACTcasesinthesecondtypeofregionhaveratherdisap-
pointingimpactsforthetargetgroup.Knowledgeisamoreimportantinputfactor
fortheSIMPACTcasesinthefirsttypeofregion,comparedtothoseinthesecond
typeofregions.
SIMPACTSIswithaverypositivelong-termoutlookareespeciallytobefoundin
regions,whichhavehighscoresontheSIfactor‘unemployment’,andwherelife-
long-learningtypeofSIsseemstoservethemarginalisedtargetgroupsaswellas
theirregionaleconomies.
-0,5-0,3-0,10,10,30,5
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Very positive LT outlook SI N = 32
-0,8-0,6-0,4-0,2
00,2
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Positive LT outlook SI N = 13
-2-1,5-1
-0,50
0,5
Economy innovator
Economy target group
Social for target group
Physical capabilities
Public budget
Negative LT outlook SI N = 8
4typesofregionalSIecosystems
120|SIMPACT–T5.1
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APPENDIX
Tablea Multidimensionalconceptionofcapital,power,marginalisation,SI,andcapabilitiesinCRESSI(‘integratingSen,Beckert&Mann’)
Kindsof
SourcesofPower2 Marginalisation(1) Socialinnovation(2) Capabilities(3)
1.Cultural(Ideological) Cm Ci Cc
2.Economc Em Ei Ec
3.Security-related(Military) Sm Si Sc
4.Political Pm Pi Pc
5.Artefactual Am Ai Ac
6.Natural Nm Nc
(1) Basedon:RistoHeiskala(2014).RelationMann’sconceptiontoCRESSI(2) NotethatthismatrixisbasedonRH’selaborationofMann’sTheSourcesofSocialPower.Manndistinguishedfour
sourcesofsocialpower:RHaddstwosources(naturalandartefactual)whileremainingthetwoothers(‘ideologicalbecoming‘cultural’andmilitarybecoming‘security-related’)
Source:HoughtonBuddetal.(2015:8)
FigureaCRESSI’sextendedsocialgridmodelandsocialinnovation
Source:HoughtonBuddetal.(2015)
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SIB(SocialInnovationBiographies)GuidingQuestions(Checklist)
IntroductoryQuestion
Pleasedescribethe innovationprocessfromtheemergenceofthefirst ideatothe implementa-tion/diffusionofthesolutionincludingtheactorsinvolved,milestonesandpitfallsinthisprocess.
I. Context&FrameworkConditions
WhatiscontextandpolicyframeworkinwhichtheSIemerged?
II. Problemaddressed
Whatparticularproblem,needordemandisaddressedbytheSI?
Whatistheidea/opportunitybehindthedevelopmentoftheSI?
Andwherediditcomefrom?
Incaseitcamefromoutside:Whatwasneededtoadaptittothecontext?
III. Motivation&CoreSolution
WhoinitiatedtheSI?
Whatwastheinitiators`motivationandbackground?
OfwhattypeistheSI:newproducts/services,organisations,oranewmethodortheirprovision,newskills,competences,resources?
TowhichdegreeistheSIboundtoaspecifictargetgroup?
DoestheSIhaveaspecificgeographicaldelimitation(community,city,regionetc.)?
InhowfaristheSIinconflictwiththegiveninstitutionalsetting?
IV. Resources&BusinessStrategy
Whatarethekeyfeaturesoftheorganisationthataredriving/promotingtheSI(informalorlegalstatus,peopleoccupied,dayoffoundationordurationoftheproject)?
Whatresources(economiccapital,socialcapital,politicalsupportandsoon)hadbeenneededtobringtheactivity/projectintolife?
Towhatextentandinwhichwaydidtheresourcebasedchangeinthecourseoftheinnovationprocess?
AnnexSIMPACT–D5.1|129
Isthereastrategytosustainandoptimisetheflowofresources?
Whatresourcesareneededbutarenot/difficulttoachieve?
Whatkindofknowledgeandcompetencieswasgivenatthebeginningoftheinnovationprocessandwhatwasmissing?Howthegapwasfilled?
Howistheactivity/projectinternallyorganised?Isthereadivisionoflabour?Dotrade-offsbetweenengagementandeffectivenessexist?
Whichsectors(divisionoflabour)areinvolvedandwhatwere/aretheirroles(ideation,implementation,financing)?
V. TheNetwork–Governance,Support&Obstacles
Whichactors(individualsand/ororganisations)whereinvolvedandwhataretheirrolesandobjectivesintheSIprocess?
Isthereanycooperationwithotherprojects?Aretheysimilarordotheyfol-lowother,butcomplementingaims?Ifyes,howdoesitwork(roleofcommu-nicationmedia,platformsofexchange)?
Aretherepoliticallinksordoesthenecessityexisttobringtheinnovationtotheforeofthepoliticalattention?
Towhatextentwastheactivity/projectaresultofperceivedfailuresorab-senceofrelatedpublicpolicymeasures?
Whatarethesocialnetworksthatareimportanttosecuretheresources?
Whathavebeenthemostimportantsupporters/opponents?
Wastheprojectconfrontedwithinstitutionalboundaries(e.g.financing),orotherboundariessuchaslaw,politicalobstaclesormissingsocietalaccepta-tion?Howwasitdealtwith?
VI. Results:Outcomes&Impact
Whatkindofvalue(includingeconomic,socialandotherformsofimprove-mentofthesituation)isgeneratedbytheSI?Whoisthebeneficiary?
Whatmustbegiven(results)tomaketheactivity/projectsuccessful?
Whataretherealisedandexpectedoutcomes(intendedaswellasunin-tended)?
Whathasbeendone/isplannedtodisseminateorscaletheapproach?
Isthereinterestinimitators/followers?Doyouworkonitinanactiveway?
DidmediaplayanyroleinthebirthorspreadoftheSI?
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Howistheactivity/projectinternallyorganised?Isthereadivisionoflabour?Dotrade-offsbetweenengagementandeffectivenessexist?
VII. Measurement
Whatistheestimatedcontribution/investmentdonebydifferentstakeholders(Euroequivalent)?
Whatistheaveragebudgetperbeneficiary,andwhatarethemaincostitemsonwhichthebudgetisspend?
Whatistheestimatedaveragevaluegeneratedafterparticipationinthesocialinnovationforthebeneficiariesandforotherstakeholders?
Whatistheestimatedlong-termvaluecreation(after5years)forthevariousstakeholdersandsocietyatlarge?
AnnexSIMPACT–D5.1|131
TextboxI. Fourexamplesofsocialinnovations.fullcasestudiesareavailableattheSIM-PACTwebsite
MothersofRotterdamisarecentprojectofBureauFrontlijn,anon-profitDutchorganisa-tionsetupbythelocalgovernmentinRotterdamtoprovidesupporttopregnantwomaninpoorneighbourhoods.Thebasicideaistofirstreducethehighstressexperiencedbythepregnantwoman,by initiallysolvingsomeof theirmosturgentproblemsfor them,andsubsequently,byteachingthemnewlifeskills.Atthesametime,theprojectsupportsthechildrenfrombeforebirthupuntilfouryears,bywhichtimethechildrenstartschool,andcanjoinanotherprojectofBureauFrontlijn.Thehelpandsupportisachievedwithagroupofstudentspayingfrequentvisitstothefamilies.BureauFrontlijnandMothersofRotter-damhavebeensuccessfulpartlybecauseofthecooperationbetweenstudentsandsocialandmedicalcareprofessionals,andbecauseoftheirfairlyradicalapproachtohelpingthemothersandtheirchildreninneed.Granny'sFinest isa socialenterprise setup (originallyasa foundation) in2011by twoDutchstudents,whosawanopportunityforcreatinganewkindofabusiness,andendeduphelpingelderly,andoftenlonelypeopleintheNetherlands.ApartfromthecentralofficeinRotterdam,themainpartoftheorganisationconsistsofknittingclubsmanagedbyvol-unteersinseveralDutchcitieswhere'grannies'(people,mainlywomen,overtheageof55)cangettogetherandknitfashionproducts,suchasscarvesandhatsfromhighqualitywooltobesoldonlineandincertainshops.Theideaisthatthepeoplegettogethersocially,andthereforereducetheirloneliness,andfeelusefulandproudbymakingthefine,mar-ketableproducts.Thebuyerscanevensendanincludedfeedbackcardtothegrannies.Co-fundingisprovidedbylocalcareproviderswhowanttogetintouchwiththeirfuturecli-ents.Meanwhile,theactivitiesimprovethewellbeingofthegrannies,reducingtheirneedformoreformalcareservices.Thefashionproductsaredesignedbyyounggraduatede-signers,creatingthemopportunitiesforpositiveexposureintheirearlycareers.VoorleesExpress isanalreadywell-establishedprojectofSodaProductiessetupin2006anddevelopedbyAnneandMariekeHeinsbroekinUtrecht.SodaProductiesisafoundationorganisedoriginallyaround theVoorleesExpressproject,whichsupportsyoungchildren(between2and8years)withdifficultiesintheirDutchlanguageskills,aswellastheparentsofthesechildren.Volunteersvisitthefamiliesonaregularbasisforhalfayear,readwiththechildren,andtrytogettheparentstotakeoverthereadingresponsibilitybyengagingthemintheactivity.Tacklinglanguageproblemsearly,wellbeforetheynegativelyaffectfurthereducationalandjobopportunities,aswellasgenerallifemanagement,issupportedbyliteratureasaneffectiveapproach.WORK4ALL isa localpublicprocurementwithsocial returnprojectsetup inRoermond(TheNetherlands)withthepurposeoftacklingfairlyhighlevelsofyouthunemploymentandrelianceonwelfaresupport.WORK4ALLinvolvescompanieshiringunemployedyouthonatemporarybasisforconstructionwork.Inadditiontoasmallmonthlypayment,theyoungpeopleareoffereda simultaneous trainingprogram in civil engineering, and thehope is that theyget furtheremploymentafter the initialphase,getoffsocialbenefits,
132|AnnexSIMPACT–D5.1
becomemoreindependent,andstayawayfromcriminalactivities.Aresponsibilityfortak-ingonthesepeople(asaproportionofallthoseemployedinaproject)isincorporatedinthepublicprocurementcallsfortendersthatthemunicipalitieswritefortheircivilengi-neeringprojects.Aftersomeinitialproblemsduetotoomuchtop-downplanninganden-forcement,theprogramhasbeentailoredtotheneedsofallthestakeholdersinvolved:theconstructioncompanies,themaintargetgroupofunemployedyouth,thetraining
sfs
socialinnovation
C EP S
WestphalianUniversity
Institute for Work & Technology